Opinion
NOT TO BE PUBLISHED
APPEAL from the judgments of the Superior Court of Los Angeles County Nos. BC 289730, 294495 Gregory W. Alarcon, Judge.
Greines, Martin, Stein & Richland, Irving H. Greines, Marc J. Poster, Jens B. Koepke; Lavely & Singer, Martin D. Singer, William J. Briggs II, and Henry L. Self III for Defendants and Appellants.
Mandel, Norwood & Grant, S. Jerome Mandel and Lilly Lewis for Plaintiffs and Respondents John Densmore, Pearl M. Courson and Columbus Courson.
Hinojosa & Wallet and Jeffrey Forer for Plaintiffs and Respondents George Morrison and Clara Morrison.
FLIER, J.
The trial court issued a permanent injunction enjoining appellants Raymond Manzarek and Robert Krieger from holding themselves out as the musical band The Doors. The trial court also ordered appellants to pay respondent John Densmore $82,274 and to pay the sum of $3.2 million to a partnership consisting of Densmore, respondents Columbus and Pearl M. Courson and George and Clara Morrison, and appellants. We affirm.
FACTS
1. The Doors, 1965-1971
Three young men met in a meditation class in Los Angeles in 1965. They were Densmore, Krieger and Manzarek; Manzarek knew a young man named Jim Morrison. Manzarek suggested that the four of them should form a band, which they all agreed to do. They began playing in the garage of Manzarek’s parents’ home in Manhattan Beach. Densmore played the drums, Manzarek the keyboard, Krieger the guitar and Morrison was the vocalist.
According to Densmore, The Doors, as the band became known, was rooted in the protest movements of the 1960’s. When asked at trial if the band had a “social philosophy,” Densmore put it this way: “Just that we were all together. A band of four brothers completely equal. And we hoped we could sort of level the playing field for everyone else out there. It was a pipe dream. But we were trying to be socially conscious.” In four years, the principle of unanimity would be written into the first partnership agreement.
In Densmore’s words: “The Vietnam war was heating up. And it kind of divided the country. Kind of like today. And we were against the war. And the seeds of the civil rights movement, the peace movement, women’s movement, they were all planted in the ‘60s. We were kind of steeped in that stuff. And some of it subliminally came out in our music.”
The Doors, as a rock-and-roll band, rose rapidly to great heights of success. In 1966, The Doors signed a six-album deal with Elektra records that would include such hits as “Light My Fire,” “L.A. Woman” and “Riders on the Storm.” Morrison played a pivotal role in the growing fame of The Doors. According to Nigel Williamson, a British critic and writer, “. . . the musical vision and the power of ‘The Doors’ came specifically from Jim Morrison. I’m not denying the contribution that the other three musicians in the group made. But I think without Jim Morrison there would not have been a group as we know ‘The Doors’ to have been. The music would not have existed in that shape or form.”
In 1969, the four men executed what the parties refer to as the “DMC Agreement,” standing for the “Doors Music Company” agreement, which provided among other things that the “management and control of the partnership business shall be determined by unanimous agreement of all partners.” In November 1970, the DMC Agreement was amended to provide that no agreement, license or other document “respecting the partnership shall be binding upon the partnership unless signed by each and every member of the partnership.” This amendment was spawned by a violent disagreement between Morrison, on the one hand, and the other three partners, on the other, over doing a Buick commercial using The Doors’ piece “Light My Fire.” While the three partners had agreed to the commercial, Morrison vehemently disagreed and the commercial was not done.
As Densmore described Morrison’s comments, Morrison accused his three partners of lacking integrity, saying “[t]hese lyrics mean stuff. It doesn’t mean, you know, break on through to a new deodorant. This is our art.”
A second agreement, executed in 1971 prior to Morrison’s departure in March 1971 to Paris, but effective as of January 1, 1966, entitled “GENERAL PARTNERSHIP AGREEMENT,” which the parties refer to as the “Old Doors Agreement,” prohibited the partners from entering into agreements without prior written consent of all of the partners. Both the DMC Agreement and Old Doors Agreement provided for the dissolution of the partnership upon the death of any partner. On March 11, 1971, prior to Morrison’s departure, the Old Doors Agreement was amended to provide that upon the termination or dissolution of the partnership other than by the death of any partner, none of the partners “shall have the right to use the name ‘The Doors’ for phonograph record purposes or in connection with personal appearances.”
Morrison died in Paris in July 1971. He left his property to his wife, Pamela Courson.
2. The New Doors Partnership, 1971-2003
In October 1971, Densmore, Manzarek and Krieger entered into a new partnership agreement that the parties refer to as the “New Doors Agreement.” (Pamela Courson was not a party to the New Doors Agreement.) This agreement duplicated the provisions of the DMC and Old Doors Agreements and it also contained the following, which duplicated the March 11, 1971 amendment to the Old Doors Agreement: “Notwithstanding anything to the contrary contained herein, upon the dissolution and/or termination of the Partnership, other than by reason of the death of any of the Partners, none of the Partners shall have the right to use the name ‘THE DOORS’ for phonograph record purposes or in connection with personal appearances.” The New Doors Agreement could be terminated by 30 days’ written notice.
Pamela Courson died in 1974. Her parents, Pearl and Columbus Courson, and Morrison’s parents, Clara and George Morrison, resolved their differences and agreed to share equally in Morrison’s interest in The Doors. The parties refer to the parents collectively as the “Estates” and we follow that usage.
George Morrison retired from the U.S. Navy as a rear admiral.
The fortunes of The Doors after Morrison’s death were mixed. On the one hand, the remaining three were not able to generate new successes without Morrison; two albums produced after Morrison’s death did only moderately well, according to Densmore, “[n]othing like the original ‘Doors.’ ” No more albums were produced because, in Densmore’s words, “. . . we realized without Jim, what were we doing? He was the soul of the band.” The partnership cancelled the recording deal it had with Elektra. With three exceptions, the trio never performed again together as The Doors. These occasions came in 1978 when they created an album performed to poetry Morrison had recorded; in 1992 when The Doors was inducted into the Rock and Roll Hall of Fame; and in 2000 when the trio performed asThe Doors for a VH1 cable channel production.
As respondents put it, The Doors endured “not as a performing band, but as a musical legacy.” Merchandising and album sales of The Doors with Morrison flourished. Densmore, Manzarek, Krieger and the Estates shared in these profits and filed partnership tax returns. The Doors, as it existed prior to Morrison’s death, continued in the public eye when Apocalypse Now (Zoetrope Studios) was released in 1979, which opened with the song “The End,” and with the release of Oliver Stone’s film The Doors (Tri-Star Pictures) in the early 1990’s, with Val Kilmer playing Morrison. Forrest Gump (Paramount Pictures 1994) played three or four Doors songs, which were sold to the movie production by the partnership for several million dollars. Merchandising deals involving The Doors also generated fees in the millions.
Respondents are Densmore and the Estates; appellants are Manzarek and Krieger.
Because of these very handsome returns, requests for permission to use The Doors in advertising proved to be tempting, at least as far as Manzarek was concerned. In 2001 or 2002, The Doorsreceived a $15 million offer from Cadillac to use a Doors hit in a sales campaign. Manzarek and the Estates were in favor of accepting it, Krieger was on the fence and Densmore was opposed because it was a Doors tradition not to do commercials. (Between 1965 and 2002, The Doors participated in only one commercial; it was for a tire company in Britain.) Morrison had been adamant against doing commercials and Densmore wanted to honor Morrison’s memory. The offer was not accepted. The same fate befell a multimillion-dollar offer made by Apple Computer, and for the same reason, at least as far as Densmore was concerned. In July 2002, an article appeared in the magazine The Nation in which Densmore was quoted as expressing philosophical objections to the use of rock music in commercials. The failed Cadillac and Apple commercials, and The Nation article, formed the basis of Manzarek’s and Krieger’s eventual cross-complaint against Densmore in which they alleged that Densmore’s conduct was unreasonable and capricious and a breach of his fiduciary obligations toward his two partners.
3. The Breakup, 2002-2003
About a year after the Cadillac offer, Harley-Davidson invited The Doorsto give a rock concert in Fontana, California, on Labor Day 2002. The occasion was a celebration of the manufacturer’s 100th anniversary; Harley-Davidson offered the group $150,000 for a two-hour concert. The trio, including Densmore, were interested in doing this concert and plans went ahead with Ian Astbury, the singer from The Cult, as the vocalist. Eventually, however, Densmore decided that his health was not up to it and he opted not to participate; Stewart Copeland from The Police appeared in his place. The concert took place without Densmore but with his consent.
Within days after the Fontana concert, Densmore read in Billboard magazine, a music industry publication, that Manzarek, Krieger, Copeland and Astbury had appeared, after the Fontana concert, at another Harley-Davidson concert in Canada. The first paragraph of the article stated: “Police drummer Stewart Copeland and Cult vocalist Ian Astbury (singing the late Jim Morrison’s parts) weren’t just temporary additions to the Doors’ lineup for last weekend’s show in Fontana, Calif. As Doors keyboardist Ray Manzarek tells Billboard.com, ‘Stewart is drumming from here on out. Ian is singing from here on out. We’re not doing a TV show. We’re playing live music. This is the new Doors lineup for the 21st century.”
Densmore was surprised, hurt and angry after he read this. Neither Manzarek nor Krieger had ever told him that there would be “a new lineup” for the 21st century or another concert in Canada.
Within a month or so after this, Krieger called Densmore and said that they wanted to go on a tour, and he invited Densmore to go with them. Densmore declined the invitation, but said that they should do a tour, as long as they made it clear that “there is a big difference between your new band and our classic ‘Doors’ band.” Densmore definitely did not think that the band composed of Manzarek, Krieger, Stewart and Astbury were The Doors. Densmore told Krieger that they should modify The Doors by calling it “The New Doors,” as an example, and that use of The Doors logo, which they had guarded jealously over the years, was strictly out.
Densmore had several telephone conversations with Krieger along the foregoing lines. At some point during these conversations, the two men discussed using the titles “The 21st Century Doors” or “The Doors of the 21st Century.” Densmore thought the title to be a mouthful and questionable since they were all getting on in years and might not see much of the 21st century, but he voiced no objection to these titles.
Ultimately, Krieger professed to agree to Densmore’s demands. Densmore had no reason to doubt Krieger’s sincerity; they had been friends for many years.
In January 2003, Densmore began getting calls from friends congratulating him on The Doors getting back together; the impetus for this appears to have been a billboard at the Palm Hotel announcing a performance by The Doorson January 19, 2003. Densmore also began to see advertisements. One in the Los Angeles Times caught his eye; it was an ad for a concert at the Universal Amphitheatre in Los Angeles scheduled for February 7, 2003. The first line of the ad states, “Witness Rock & Roll History”; this line is followed by “The Doors” and The Doors logo; in small print under the logo is “21st Century” and “Live”; and Manzarek, Astbury, Krieger and Copeland are shown as a group. Changes to The Doorswebsite, which referred to the 21st century band, and advertisements along the lines of the Los Angeles Times ad continued, much to Densmore’s concern and dissatisfaction.
When asked at trial whether the Los Angeles Times ad represented what Densmore had had in mind when he discussed “21st Century Doors” with Krieger, Densmore testified: “Absolutely not. This infuriated me. I couldn’t believe that the modifier ‘21st Century’ is about a tenth the size of the word ‘Doors.’ And the word ‘Live’ under it implies 21st century live tour starring this band, ‘The Doors.’ ”
Densmore had three telephone conversations with Krieger after he saw the Los Angeles Times ad. Densmore was angry; he told Krieger they were using The Doors logo, the modifier “21st Century” was too small, and it was not clear that this was a new band. Krieger’s response was that that’s the way they had to do it “if we want to play big concerts.” Krieger suggested minor changes that did not satisfy Densmore.
On March 19, 2003, Densmore wrote Manzarek and Krieger, stating that he was terminating the New Doors Agreement of 1971. Under the terms of that agreement, this precluded use of The Doors name; nevertheless the band composed of Manzarek, Krieger and Astbury continued to appear as The Doorsor as The Doors of the 21st Century and display The Doorslogo.
4. Appellants’ Band, 2003-2004
Manzarek, Krieger and Astbury appeared and performed on three nationally televised shows in January and February 2003.
After the February 7, 2003 concert in Los Angeles, the band composed of Manzarek, Krieger, and Astbury performed more than 65 concerts in approximately two years. The advertisements for these concerts used the word “Doors” in various permutations, and took differing approaches to the modifier “of the 21st Century.” The trial court found that in approximately 30 concerts performed during this period, the image of Jim Morrison was displayed to the audience from 30 to 90 seconds at the inception of the concert. Morrison’s voice singing Doors songs was used in advertising for the band in several cities on the tour. Merchandising used the word “Doors” and words and phrases associated with Morrison.
The trial court found in its statement of decision that these concerts grossed more than $8 million and generated more than $2.7 million in profits; these findings were supplanted by a stipulation, entered into after the trial, that the net profits were $3.2 million. No part of these earnings was ever transmitted to Densmore or the Estates. The proceeds all went to Doors Touring, Inc., the band’s “loan-out” corporation.
PROCEDURAL HISTORY
1. The Complaints and the Cross-complaint
Densmore filed his action on February 4, 2003, three days before the band’s first major concert in Los Angeles. The complaint alleged six causes of action. The first cause of action set forth alleged violations of the Lanham Act (15 U.S.C. § 1125(c)(1)) in that the defendants (Manzarek, Krieger, Astbury and Copeland) threatened to perform as The Doors and advertised their performances using The Doors name and The Doors’ distinctive logo. The second cause of action was for unfair competition. The third cause of action alleged violations of Business and Professions Code section 17200. The fourth cause of action was for breach of two oral partnership agreements that were allegedly formed after Morrison’s death; these were the DMC and Old Doors Agreements. The fourth cause of action alleged that Manzarek and Krieger had violated the principle of unanimity contained in these agreements. The fifth cause of action set forth an alleged breach of the New Doors Agreement. The sixth cause of action alleged that Manzarek and Krieger had breached their fiduciary duty toward Densmore by diverting to themselves the renown of The Doors and reaping the benefits of this misconduct; this cause of action alleged violations of the DMC and Old Doors Agreements.
We refer to the allegations of the second amended complaint.
Copeland was dismissed and all of the jury’s eventual findings exonerated Astbury.
The jury eventually returned verdicts for Densmore on the fifth and sixth causes of action, and found for appellants on the remaining claims.
The complaint sought the following relief: First, an injunction enjoining the defendants (a) from using the name and logo of The Doors; (b) from selling or marketing themselves in such a way as to suggest that they were, or were affiliated with, The Doors; and (c) to deliver up all products confusingly similar to The Doors’ distinctive trademark and logo. Second, the complaint sought an order that the defendants be required to account for all profits arising from the unlawful use of The Doors distinctive trademark and logo. Third, the complaint demanded that Manzarek and Krieger respond in damages for their breaches of the oral partnership agreement and the New Doors Agreement.
The Estates filed their action on April 23, 2003. The plaintiffs were Columbus and Pearl Courson and Clara and George Morrison, who, it was alleged, held between them James Morrison’s 25 percent partnership interest inThe Doors. The Estates’ action largely tracked the lawsuit filed by Densmore, with the exception that it included a cause of action for the misappropriation of Morrison’s name and likeness, in violation of Civil Code section 3344.1. As in Densmore’s action, the Estates’ complaint included a cause of action for breach of fiduciary duties based on The Doorspartnerships, i.e., the Old Doors and DMC Agreements. The Estates’ action also included a cause of action that sought to impose a constructive trust and that sought an accounting. The relief demanded by the Estates’ action was largely the same as in Densmore’s lawsuit, with additional injunctive relief predicated on the misuse of Morrison’s name and likeness.
The jury returned verdicts favorable to the Estates on this cause of action, and on the preceding cause of action based on Civil Code section 3344.1. The jury found for appellants on the remaining claims.
Manzarek and Krieger cross-complained.
The cross-complaint alleged that during Morrison’s lifetime decisions were made by majority vote, and did not require unanimity; that the New Doors Agreement did not actually reflect the true intent of the signatories thereto since “the partners would sign contracts and legal documents without reading them,” and the true intent behind the purported unanimity rule was to prevent individual partners from unilaterally conducting business; that Manzarek dissolved the partnership in 1973; that in 1978 Densmore participated in producing an album of music with poetry recorded by Morrison and that this was a waiver, by Densmore, of the New Doors Agreement’s provision that no member can use The Doors name after termination of the partnership; that Densmore’s conduct was arbitrary and reflected bad faith when he vetoed the $15 million Cadillac offer; that the cross-complainants repeatedly asked Densmore to tour with them but that he unreasonably refused to do so; and that the cross-complainants continued to extend an invitation to Densmore to join the band.
The cross-complaint alleged seven causes of action. The first cause of action for breach of fiduciary duty alleged that Densmore acted capriciously in refusing to consent to various ventures and in insisting that he had the right to veto decisions made by the majority. The second cause of action was for the breach of the covenant of good faith and fair dealing and relied largely on the same facts as the first cause. The third cause of action for promissory estoppel alleged that Densmore led the cross-complainants to believe in 2002 that he would tour with them, a promise on which they relied. The remainder of the cross-complaint was for intentional interference with economic advantage; violations of Business and Professions Code section 17200; declaratory relief, notably a declaration that “21st Century Doors” and “The Doors of the 21st Century” are not likely to cause confusion; and reformation. The cross-complaint demanded a trial by jury.
The jury found for the cross-complainants on the first three causes of action.
2. The Trial Court Denies Respondents’ Motions for a Preliminary Injunction on the Condition That Appellants Add to “The Doors” the Qualifier “of the 21st Century”
In April and May 2003, the trial court denied respondents’ applications for a temporary restraining order and preliminary injunction enjoining use of The Doorson the condition that the defendants use the qualifier “of the 21st Century” after The Doors name. Appellants seek to exploit this preliminary ruling in this appeal, contending that they did nothing more or less than what the trial court’s rulings on these provisional remedies allowed them to do.
We address this contention in part 9 of the Discussion. Here we note that, particularly during April 2003, the trial court was presented with advertising using The Doors name and logo, much of which had already been displayed, for performances to which appellants were contractually committed. The trial court had to deal pragmatically with these circumstances. Nor was the denial of provisional relief an indication that the court saw no merit in respondents’ side of the case. In ruling on the application for a temporary restraining order, the court found that Densmore “has raised a colorable argument regarding a threat of serious harm,” but the court found that Densmore’s notice of termination of the New Doors Agreement detracted from the claim that he was facing irreparable injury.
It is evident that in April and May 2003, when considering the applications for preliminary injunctive relief, the court was required to consider facts and circumstances that played no role in the ultimate resolution of the controversy between the parties.
3. Respondents Declare That They Do Not Seek Damages
Densmore’s and the Estates’ actions were consolidated for trial.
Densmore’s and the Estates’ complaints both sought damages for breach of contract. Apparently the first indication that respondents were not going to seek damages came during a hearing on discovery disputes held on April 22, 2004. During the course of argument, counsel for Densmore stated that “Mr. Densmore is not seeking to recover damages in the classic sense but disgorgement” and “We do attribute other damages to the conduct of the defendants. [¶] Do we seek to recover them? [¶] No. [¶] I made it very clear we are not intending to try to recover damages to the catalogue or reputation of The Doors. We think it has been damaged. But we are seeking to recover only in the form of disgorgement those profits earned by the defendants from their performing, recording, and videotaping activities.”
During his opening statement, counsel for Densmore and the Courson estate stated that while The Doorsname and legacy had been harmed, “[w]e don’t want damage [sic] for the harm. . . . [¶] [W]e do want them to give to the partnership of four the revenues that they’ve made by using this name because it’s not right for them to keep it. They didn’t have a right to use it. That’s what we want, ladies and gentlemen. . . .” Counsel for the Morrison estate stated that “we want them to turn over their ill-gotten gain.”
As we discuss post, respondents never deviated after these opening remarks from their argument that they were seeking profits that belonged to The Doors’ partnerships. This is significant in that the calculation of partnership profits is usually a matter addressed in accounting proceedings on the equity side of the court.
4. Respondents Request During Trial That the Court Decide the Equitable Issues First; the Request Is Denied
Respondents state in their principal brief that they advised the trial court in late June 2004 “that they were waiving a jury trial given the predominant equitable issues” but that the “[appellants] demanded a jury trial.” The record is not as clear and streamlined as this, at least as far as the jury waiver is concerned. On June 25, 2004, in a pretrial conference, counsel for Densmore and the Courson estate stated: “We’ve given this a lot of thought, [respondents] and their counsel. And we know that the court is in a position to deal with the equitable and legal issues both. We’re inclined to waive the jury in favor of you trying this case. We think it’s faster, easier, just better for everybody for this to be a court trial if you were the judge.” While the reasons for the jury waiver appear to be mixed, there was no ambiguity about appellants’ demand for a jury trial, which they repeated after the quoted statement. Thus, a jury was impaneled on July 6, 2004.
Opening statements were made on July 6, 2004, and the first witness began his testimony that day. On July 27, 2004, respondents served on appellants a motion to have the equitable issues determined first by the court. Respondents’ motion took the position that their action was for injunctive relief, an accounting, restitution and imposition of a constructive trust, i.e., it was solely an equitable action. Respondents also contended that the cross-complaint was also solely equitable in nature. Appellants opposed the motion, contending that whether there was a partnership agreement, what its terms were, and whether that agreement was breached were all questions of law on which they were entitled to a jury.
Closing arguments commenced on August 30, 2004.
On August 27, 2004, the trial court entered a minute order in which it noted that it had reviewed the jury instructions proposed by both sides, that it had rejected certain proposed instructions and approved others and that the court now required joint jury instructions. The minute order concluded by stating: “The Court will have the jury decide the legal issues first along with advisory findings regarding equitable issues.”
In principle, this minute order operated as a denial of respondents’ motion to have the court decide the equitable issues first. Unfortunately, this order did not address which claims were legal and which were equitable. In fact, the trial court left this question open until it filed its statement of decision in July 2005; as we relate below, the trial court expressly declined to make such a ruling while the jury was deliberating during September 2004.
The situation was complicated by the circumstance that there were some claims or causes of action that were not submitted to the jury for decision. These were the Estates’ fifth cause of action for a violation of Business and Professions Code section 17500 (false advertising), the Estates’ causes of action for the imposition of a constructive trust and for an accounting and the causes of action in the cross-complaint for declaratory relief and a reformation of the New Doors Agreement. Thus, when the case went to the jury, some claims had been withheld because they were equitable but some equitable claims did go to the jury.
It would have made for greater clarity if in the minute order of August 27, 2004, or in any event before the case went to the jury, the court had ruled which of the causes of action submitted to the jury were legal and which were equitable. This decision had to be made at some point. It is most useful to make this decision before the case goes to the jury. It is at that point, and not a year after jury deliberations, that the parties and the jury should know what questions are for the jury and what questions are reserved for the court.
The lack of clarity about which claims were equitable and which were legal unnecessarily created the impression that the court was revising the jury’s verdicts. An example of this occurred when the court did not follow the jury’s verdict on the claim for promissory estoppel asserted in the cross-complaint. The court found in its statement of decision that this was an equitable claim and that the verdict was advisory only. Had this been made clear before the case went to the jury, the impression would have been avoided that the court was revising the jury’s verdict on this claim.
As it was, the question of which claims were legal and which were equitable first surfaced on July 27, 2004, during the trial, and was not resolved until July 2005, long after the verdicts had been returned. Such a delay could only have a negative impact, as in fact turned out to be the case.
5. Arguments on the Evidence of Gross Earnings and Profits
The question whether respondents were harmed by appellants’ breaches of the partnerships agreements, assuming there were any breaches, was to surface during jury deliberations, as we discuss in part 7, post, of the Procedural History. The closing arguments of counsel clearly delineated the parties’ conflicting positions on this issue.
Mr. Mandel, counsel for Densmore and the Courson estate, stated that the money that was (hopefully) to be awarded would not go “to John Densmore’s pocket. It’s going to go to the partnership that owns the name. It’s going to go to the partnership whose property has been stolen. And if Manzarek and Krieger own half that partnership, so be it. We understand that.” Later, referring to Manzarek and Krieger, Mr. Mandel stated that each of them had earned $2.5 million, that Astbury had been paid $1 million, and that the concerts had grossed $8.5 million.
Attorney Jeffrey Forer, counsel for the Morrison estate, devoted considerable time to the issue of profits and gross revenues. He began by stating that the band had grossed $9 million. After pointing out that Manzarek, Krieger and Astbury had used Morrison’s name and likeness for their own benefit, Mr. Forer reviewed the exhibits that reflected income and expenses of Doors Touring, Inc., between August 2002 and July 2004. He then turned to checking account activity of another company used by appellants, Diamond Night Productions in 2003 and 2004. A summary of all of these documents showed earnings of $7,767,000, but this, according to Mr. Forer, was an incomplete figure. When merchandising and royalties were added, the gross earnings came “close to $9 million total.” Mr. Forer then examined in detail expenses claimed and argued that they were excessive since these operating expenses included salary paid Manzarek and Krieger, which, according to Forer, were not legitimate expenses. Forer challenged yet another tabulation of expenses that showed a loss of $1.6 million because these expenses included legal fees. Forer thought the legitimate expenses were between $4 and $5 million.
These were exhibits 745, 792 and 793.
Attorney William Briggs, appellants’ counsel, countered these arguments by first pointing out that Densmore was invited to join the band but refused to do so. “He [Densmore] knows the basic principles of someone being in a band. If you don’t play, you don’t get paid.” Mr. Briggs then stated that after considering the expenses, the band operated at a loss, that all that Manzarek and Krieger took home with them was $439,000. In substance, the arguments were that Densmore was entitled to earnings only if he performed with the band and that, in any event, there were no profits or that, at best, the profits were minimal.
6. Jury Instructions
Respondents state in their principal brief that after the trial court’s minute order of August 27, 2004 (see part 4, ante, of the Procedural History), they prepared with appellants jury instructions “under protest.” There is no transcript reference to tell us what this protest was and when it was made. In any event, if the respondents were protesting that the jury was also receiving instructions on equitable claims, the protest was fruitless in that the instructions covered claims that were unquestionably equitable in nature. Remarks by the trial court, which we set forth in part 7, post, of the Procedural History, suggest that, on the equitable claims, the trial court considered the jury’s role to be advisory, a matter confirmed in the statement of decision.
We summarize the salient aspects of the instructions that pertain to the causes of action on which Densmore and the Estates recovered favorable verdicts. In light of appellants’ principal contention that the jury’s verdicts exonerated appellants, particularly noteworthy in the instructions is that the jury was instructed that, in order to recover, respondents had to show that they had been harmed.
On the breach of the New Doors Agreement, the jury was instructed that they had to find that Manzarek, Krieger and Densmore entered into this agreement, that Manzarek and Krieger “failed to do something that the contract required him or them to do or did something that the contract precluded them from doing,” and that Densmore “[was] harmed by that failure.”
Respecting the breach of the Old Doors and DMC Agreements, the jury was instructed that they had to find that Densmore, the Estates, Manzarek and Krieger formed such partnerships, that Manzarek and Krieger “failed to do something that the contract required him or them to do or did something that the contract precluded him or them from doing,” and that Densmore and the Estates “were harmed by that failure.”
On the claim brought under Civil Code section 3344.1, the jury was instructed that they had to find that appellants used Morrison’s name or likeness and that the Estates were harmed by this use.
No instructions on money damages were given.
In the instructions covering the Lanham Act, the jury was instructed that respondents had “elected not to seek such damages” and that they were seeking instead “injunctive relief and [appellants’] profits.” The jury was instructed how to calculate profits; these instructions were associated with the instructions on the Lanham Act.
7. The Question of “Harm” Arises During Jury Deliberations; Counsels’ Responses to the Jury’s Questions
The case went to the jury on September 2, 2004. The jury deliberated on September 7, 8, 9, and 10. On September 13, 2004, the jury returned with some questions. In addition to requesting read-back of testimony, the jury apparently had questions on the topics of what constitutes a breach of contract and what was meant by “harm” in the instructions on breach of contract. Unfortunately, the record does not appear to contain the actual questions asked by the jury but the comments of court and counsel make it acceptably clear what those questions were.
After the questions were presented to the court, the jury retired to resume deliberations and court and counsel discussed the questions propounded by the jury. Attorney Mandel, counsel for Densmore and the Courson estate, noted that the jury was “wrestling with [the] concept[] of harm” and that “[w]hile the disgorgement and the unjust enrichment are equitable remedies that the court will deal with, I think they need to understand for purposes of this that [sic] includes that.” Attorney Briggs, appellants’ counsel, disagreed, stating that this was a breach of contract claim, which was a matter for the jury. The court stated: “This is my suggestion: There’s so much that they’ve asked for. Why don’t we slowly look at this because I’d like to look at your original briefs when [sic] this whole issue of contract versus equitable. I think we can work this out. And interesting [sic] to see what they come up with. [¶] Their clarification may save a lot of time for us. Why don’t we pass it for a moment.”
After some discussion, the court decided to allow counsel to present argument on the questions the jury had asked.
Mr. Mandel went first. He stated that there had been two breaches of the partnership agreement. They were that Manzarek and Krieger had decided to tour as The Doors in 2002 when there was no unanimous agreement that they could do so. The second breach was that, after the termination of the New Doors partnership, Manzarek and Krieger used the name The Doors. Mr. Mandel then turned to the question of harm:
“Question No. 5 is a significant issue, and that is that [respondents] were harmed by the failure. In evaluating whether [respondents] were harmed by the failure, you have to keep in mind who [respondents] are and secondly what does it mean to be harmed which is the question that has been asked. [¶] With respect to who are [respondents], keep in mind that with respect to some of the causes of action, John [Densmore] has sued individually and on behalf of partnerships. Harm in the context of this lawsuit does not necessarily mean economically damaged. It doesn’t mean that we have to show that John lost money as a result of the breach of either of--as a result of either of the breaches that we’ve described. [¶] We have to show that John or the partnerships were harmed. We think that they were harmed because what’s happened is one form of harm is that the alleged wrongdoer has done something wrong and has benefited at the expense of the person who is complaining or the partnership who is complaining. [¶] . . . . [¶] So we believe in this case that there are two separate breaches both of which result in the same harm, that is, [appellants] have profited to the tune of roughly $3 million. They ought not to keep that in light of their own failure to adhere to the contract. And that’s the amount that should be awarded either in favor of John or in favor of the partnership as the court will determine at such time as the court considers everything that is going on and we deal with the other issues that are in this case.” (Italics added)
The reference is to the failure to adhere to the partnership agreements.
The response to this argument came from Attorney Briggs, appellants’ counsel. Mr. Briggs began with the point that Densmore, as a professional musician, knew that if you don’t play, you don’t get paid--and that Densmore admitted that he didn’t play at the Harley-Davidson concert or thereafter. Mr. Briggs disagreed with the claim that this was a case of unjust enrichment. Giving the example of a person using a car belonging to someone else, and stating that under such circumstances the owner of the car should be compensated, Mr. Briggs stated “[t]hat’s not what happened here. [¶] . . . [¶] [T]here was no harm. There is no harm. If you’re looking for the type of harm that that jury instruction is requesting of you, it’s how much is he out-of-pocket? Absolutely nothing.” When Mr. Mandel gave his reply argument, he closed by stating: “Harm is as we’ve discussed, the disgorgement, economic benefit.” Thus, as both counsel framed the issue for the jury, the question was whether the harm was the profits the appellants made on tour or whether the harm was Densmore’s out-of-pocket loss. If it was out-of-pocket loss, there was no harm since there was no evidence of out-of-pocket loss.
The proceedings of September 13, 2004, were very significant. As counsels’ arguments framed the issue for the jury, the question was whether respondents had been harmed to the extent they did not share in the profits generated by appellants’ concerts or whether, as appellants contended, respondents had not been harmed because they had not sustained any out-of-pocket loss. Thus, the jury had a real decision to make: Was the harm the loss of profits or was it an out-of-pocket loss? Significantly, if it was the former, Mr. Mandel had argued without drawing an objection that the court would determine the amount that would be awarded to the partnership. Neither the court nor opposing counsel corrected Mr. Mandel’s statement. The jury was left with one impression and one impression only: they were not to determine the amount of lost profits.
8. The Special Verdicts
The case went to the jury on September 2, 2004; the jury returned its verdicts on September 27, 2004, having deliberated during most of September.
The jury rejected the following of respondents’ claims: (1) Lanham Act (Densmore and Estates); (2) common law unfair competition (Densmore and Estates); (3) Business and Professions Code section 17200 (Densmore and Estates); (4) breach of oral partnership agreements (the DMC and Old Doors Agreements) (Densmore); (5) common law trademark infringement (Estates); (6) state trademark dilution (Estates); (7) breach of contract (Estates); and (8) breach of implied contract (Estates).
Respecting Densmore’s action, the jury found that Manzarek and Krieger had breached the New Doors Agreement and also had breached their fiduciary duties under The Doors partnerships. These claims were set forth respectively in the fifth and sixth causes of action. The jury found that Manzarek and Krieger were liable to Densmore for these breaches but entered a zero, in each instance, to the question “what amount, if any, do you award” for these breaches.
On the Estates’ action, the jury found that Manzarek and Krieger had violated Morrison’s postmortem right of publicity and that they had breached their fiduciary duties under the Old Doors and DMC Agreements. These were the seventh and 10th causes of action. As with Densmore, the jury found Manzarek and Krieger liable to the Estates for these breaches and entered a zero, in each instance, to the question “what amount, if any, do you award” for these breaches.
On the cross-complaint, the jury found that Densmore had breached his fiduciary duties that he owed Manzarek and Krieger, that he also breached the covenant of good faith and fair dealing incorporated in the New Doors Agreement, and that Densmore was also liable on the promissory estoppel claim. These were the first, second and third causes of action of the cross-complaint. As with Densmore and the Estates, the jury entered a zero, in each instance, to the question “what amount, if any, do you award” for these breaches. The jury found for Densmore on the cause of action for a violation of Business and Profession Code section 17200. The sixth and seventh causes of action of the cross-complaint, for declaratory relief and a reformation of the New Doors Agreement respectively, were not submitted to the jury for decision.
9. The Statement of Decision
Following the verdict, the parties filed voluminous memoranda on what the terms of the judgment should be. Appellants contended that the jury’s verdict resolved all questions of fact in their favor and that the court should enter a judgment for them. Respondents argued that virtually all of the claims were equitable or sought equitable relief and that the jury verdict was therefore only advisory. Respondents also contended that the verdicts returned by the jury were confusing and contradictory.
The trial court requested additional briefing on a number of specific issues; the final memorandum in response to this order was filed on February 25, 2005.
The court filed an extensive statement of decision on July 21, 2005.
a. The Statement of Decision on the Question of Legal and Equitable Issues
The court noted that when the trial commenced, the general understanding was that the jury was to function in the usual way, i.e., there was no mention of the jury sitting in an equitable case as an advisory jury only. It was only after the trial had been underway that respondents made known their position that the case was solely a proceeding in equity. But the court could not treat the verdicts on the legal causes of action as advisory only without violating the right to a trial by jury. Thus, the court would enter a judgment on the legal causes of action in accordance with the jury’s verdicts.
b. Densmore’s Action
The trial court concluded that appellants were entitled to judgment on the first four causes of action in that the jury had found in their favor on these causes of action.
These were the causes of action based on the Lanham Act, for common law unfair competition, for violations of Business and Professions Code section 17200 and for breach of the Old Doors oral partnership agreement.
The fifth cause of action was for the breach of the New Doors Agreement; the jury found for Densmore on this claim but did not award monetary damages. The trial court concluded that harm, not damages, is an essential element of a breach of contract action and that “when a jury does not award damages, this does not conclusively mean that the jury has found no harm. . . . The ‘harm’ in this case was the taking of a partnership asset and exploiting it without permission from the other partners. Judgment is entered in favor of Densmore. The equitable remedies of disgorgement of profits and a permanent injunction are ordered, notwithstanding the jury’s finding of no damages.” The trial court made an identical finding on the claim for breach of fiduciary duty, wherein the jury also had found for Densmore.
c. The Estates’ Action
The trial court entered judgment for appellants on the first, second, third, fourth, sixth, eighth and ninth causes of action in light of the special verdicts returned by the jury.
These were the causes of action based on the Lanham Act, for common law trademark infringement, common law unfair competition, violation of Business and Professions Code section 17200, state trademark violation, and breach of contract.
The fifth cause of action for false advertising under Business and Professions Code section 17500 was deemed to be an equitable claim. The trial court found that Manzarek and Krieger had prominently displayed The Doors logo, minimized the qualifier “of the 21st Century” and had engaged in other acts of false advertising. The court issued a permanent injunction restraining Manzarek and Krieger from false advertising.
The court concluded that the seventh cause of action for violation of Morrison’s right of publicity under Civil Code section 3344.1 was a legal cause of action and that the jury had found for the Estates on this claim but awarded no monetary damages. The court awarded $750 in statutory damages on this claim.
Section 3344.1 provides in relevant part: “Any person who uses a deceased personality’s name, voice, signature, photograph, or likeness, in any manner, on or in products, merchandise, or goods, or for purposes of advertising or selling, or soliciting purchases of, products, merchandise, goods, or services, without prior consent from the person or persons specified in subdivision (c), shall be liable for any damages sustained by the person or persons injured as a result thereof. In addition, in any action brought under this section, the person who violated the section shall be liable to the injured party or parties in an amount equal to the greater of seven hundred fifty dollars ($750) or the actual damages suffered by the injured party or parties, as a result of the unauthorized use, and any profits from the unauthorized use that are attributable to the use and are not taken into account in computing the actual damages.”
On the 10th cause of action for breach of fiduciary duties, where the jury had found for the Estates, the trial court found that the Estates were 25 percent partners in the Old Doors Agreement with Densmore, Manzarek and Krieger. The court awarded the equitable remedies of a permanent injunction and disgorgement of profits earned by Manzarek and Krieger after April 18, 2003.
The court noted that the causes of action for the imposition of a constructive trust and for an accounting were equitable claims and were not presented to the jury. The court concluded that it would impose a constructive trust and it ordered that an accounting of profits take place.
d. The Cross-complaint
It will be remembered that the jury found for appellants on the first three causes of action of the cross-complaint but that the jury did not award any monetary damages to appellants, i.e., the cross-complainants. For differing reasons, the trial court set these verdicts aside and entered judgment for Densmore on all three causes of action.
The trial court analyzed the first cause of action of the cross-complaint for breach of fiduciary duty in two steps. (This cause of action was predicated on Densmore’s refusal of the Cadillac and Apple offers and the article in The Nation.) First, the court noted that the jury did not award monetary damages, that appellants did not seek equitable relief in this cause of action and that the court did not think that such relief was warranted. Second, the court gave reasons why equitable relief was not indicated. The reasons that such relief was not warranted were that (1) Densmore and Krieger never voted to accept the Cadillac and Apple offers; (2) if unanimity was the rule, the offers could not be accepted; and (3) if a majority was sufficient, a majority never voted to accept the offers. As far as The Nation article was concerned, there was no evidence that any commercial prospects were lost because of this article. Thus, since appellants “have failed to demonstrate their entitlement to any relief based on this claim,” judgment was entered for Densmore.
The second cause of action for breach of the covenant of good faith and fair dealing was dealt with by the court in the same way. (This cause of action was predicated on Densmore allegedly reneging on his permission to allow Manzarek and Krieger to do the Harley-Davidson concerts under The Doorslogo.) Appellants were not entitled to equitable relief because they had not complied with the conditions that Densmore laid down as part of his agreement to the Harley-Davidson concerts.
The court concluded that the third cause of action for promissory estoppel was an equitable claim and that the jury’s verdict was therefore advisory only. (This cause of action was based on Densmore’s alleged representation to Manzarek and Krieger that they could perform as The Doorsafter the Harley-Davidson concerts.) The court found that Densmore had established two conditions, neither of which was met. These were that the new band’s name be clearly modified to reflect that it was not The Doors and that the new band would not use The Doors logo. The court cited Krieger’s testimony acknowledging the modifier and conceding that he “ ‘didn’t get around to it.’ ” Since Densmore’s conditions were not met, promissory estoppel could not be invoked. Accordingly, judgment was entered on this cause of action for Densmore.
The jury found for Densmore on the fifth cause of action for a violation of Business and Professions Code section 17200; the court entered judgment for Densmore.
The fourth cause of action of the cross-complaint for intentional interference with economic advantage was dismissed prior to trial.
On the sixth cause of action for declaratory relief, the court concluded that (1) the rule governing the various Doors partnerships was unanimity, not majority; (2) use by appellants of the name “The Doors of the 21st Century” was a violation of Business and Professions Code section 17500; (3) appellants do not have the right to use the title “The Doors of the 21st Century”; (4) there is no competent evidence to support appellants’ assertion that there was no meeting of the minds on the Old and New Doors Agreements; (5) The Doorsname was owned by the Old Doors partnership and is now owned by Manzarek, Krieger, Densmore and the Estates; and (6) The Doorsname was not abandoned to the public domain.
Finally, the court declined appellants’ request to reform the New Doors Agreement (seventh cause of action), finding that the parties thereto were “mature, educated men, represented by competent legal counsel when the New Doors partnership agreement was executed. Somers, their legal counsel, testified that the agreement was explained to the three of them.”
e. Orders Entered in the Statement of Decision
The statement of decision concluded by indicating that the court would enjoin Manzarek and Krieger from holding themselves out as The Doors, The Doorsof the 21st Century or using a name including the words “The Doors.” The statement of decision also held that the profits earned by Manzarek and Krieger as The Doors or The Doors of the 21st Century be divested and distributed as follows: (1) one-third of all profits between January 1, 2003, and April 18, 2003 be delivered to Densmore; and (2) all profits after April 18, 2003, be turned over to the Old Doors partnership.
Manzarek, Krieger and Astbury began performing as The Doors in January 2003; the New Doors Agreement was terminated effective April 18, 2003.
The statement of decision ordered appellants to submit a written accounting with supporting documentation on profits earned from and after June 30, 2003, and prior to April 18, 2003. The court ordered respondents to file a reply and set a hearing on the accounting for September 6, 2005.
10. Injunction and Judgment
On July 21, 2005, the court issued a permanent injunction enjoining Manzarek and Krieger from holding themselves out as The Doors, The Doors of the 21st Century or using any other name that includes the words “The Doors” without written consent of the partners of the Old Doors Agreement. The injunction allows Manzarek and Krieger to identify themselves as founding or original members of The Doorsunder certain specific conditions but specifically bars use of The Doors logo. Manzarek and Krieger were also enjoined from using the name, likeness, voice or image of Morrison to promote their band or their concerns.
The judgment that reflected the conclusions and findings of the statement of decision was entered on November 21, 2005. The judgment did not address or dispose of the accounting issues identified in the statement of decision.
On December 16, 2005, the parties reached an agreement on the accounting issues left open in the judgment. Based on that agreement, the court entered an addendum to the judgment on January 4, 2006, in which it ordered Manzarek and Krieger to each pay Densmore in “full and final disgorgement of one-third of all profits . . . from January 1, 2003, through April 18, 2003” the sums of $41,137 for a total of $82,274. Also in “full and final disgorgement of all profits” after April 18, 2003, Manzarek and Krieger were each ordered to pay the Old Doors partnership $1.6 million for a total of $3.2 million. These were the sums to which the parties had stipulated on December 16, 2005.
DISCUSSION
1. The Jury Deferred the Calculation of Lost Profits to the Trial Court
It will be remembered that the jury returned four verdicts favorable to respondents. These were verdicts for the breach of the New Doors Agreement in Densmore’s action, for appellants’ breaches of their fiduciary duties to Densmore and the Estates under the Old Doors and DMC Agreements, and for the violation of Morrison’s postmortem right of publicity. The jury responded with “$0” to the question “what amount, if any, do you award” for these breaches. The question is whether this means that the jury concluded that respondents sustained no harm or whether the jury intended to defer the calculation of damages, i.e., lost profits, to the trial court.
There are seven factors that must be taken into account in considering this question.
First. Respondents were consistent in stating, beginning with hearings prior to trial, that they were not seeking damages but profits. As far as the jury was concerned, respondents made this clear in their opening statements, in their closing arguments and in their arguments to the jury on September 13, 2004, made in response to the jury’s questions.
Second. There was no monetary evidence presented other than loss of profits.
Third. Evidence was presented on profits and the jury received several instructions on the calculation of profits. But all of these instructions were given in conjunction with the trademark claim brought under the Lanham Act, a claim on which the jury found for appellants.
Fourth. Other than the Lanham Act instructions, no instructions were given on damages or on loss of profits. This includes the instructions on the cross-complaint; the only instruction given on the claim that Densmore’s breached the covenant of good faith and fair dealing was that his conduct must have caused harm to appellants.
Fifth. An accounting and determination of profits, together with an order distributing the profits to respondents, is unquestionably on the equity side of the court. (5 Witkin, Cal. Procedure (4th ed. 1997) Pleading, § 775, p. 233.)
Sixth. Midway during its deliberations, the jury was told that the court would determine, at a later stage of the proceedings after the verdict, what the profits were. On September 13, 2004, Attorney Mandel stated outside the presence of the jury that the court would “deal with” disgorgement and unjust enrichment as equitable remedies. Following this comment, during Mr. Mandel’s ensuing argument to the jury he stated that the court would determine what the profits were.
Seventh. The jury found for Densmore on the breach of the New Doors Agreement, and for Densmore and the Estates for breach of appellants’ fiduciary duties under the Old Doors and DMC Agreements. The jury also found that appellants had violated Civil Code section 3344.1 in misappropriating Morrison’s name and image. In each instance, the jury was instructed that they had to find that the breaches, if any, harmed respondents. Thus, in returning verdicts for respondents on these claims, the jury found that respondents were harmed by these breaches. In terms of the theory presented to the jury by respondents, that harm was loss of profits.
See Procedural History, part 6, ante.
These seven factors, and their interplay, lead us to conclude that the jury made no monetary award because it believed that this would be done by the court.
Our dissenting colleague concludes that the conclusion that Densmore, i.e., respondents, was harmed did not permit the court to “disregard the jury’s award of zero damages on an indisputably legal claim for breach of contract.” But the verdict form in this case cannot be viewed in a vacuum that does not take into account the factors that we have identified. The totality of these factors indicates that the jury understood that, apart from the Lanham Act claim, it was the court that would determine the amount of lost profits.
The dissent states that if it was the court that would determine the amount of lost profits, there would have been no need to hear testimony about receipts and expenses, no need for counsel to argue about how to calculate profits and no need for instructions on permissible deductions and apportionment of gross profits. This is a misperception of the realities of this case. First, from the very beginning respondents’ case was that they sought lost profits, i.e., that the harm they had sustained was loss of profits. This was therefore a central aspect of the case; if the jury did not conclude that appellants misappropriated profits belonging to respondents, the latter could not prevail on any their claims. It was another matter who would calculate the amount of lost profits. Second, the jury instructions on permissible deductions, apportionment of profits and the like were given only in connection with the Lanham Act claim. Once the jury found for appellants on that claim, the jury could justifiably conclude that they did not have to concern themselves with those instructions. Third, the very fact that, outside the Lanham Act claim, there were no instructions on damages or lost profits shows that it was everyone’s -- including the jury’s -- understanding that the court would calculate the amount of lost profits.
The dissent states that respondents cannot cite “to a single page of the nearly 20,000-page record in which the jurors ever were told that they should calculate profits on the trademark and unfair competition claims, but that the court would calculate profits on the breach of contract and fiduciary duty claims.” On September 13, 2004, cited both in our opinion and the dissent, Mr. Mandel told the jury that the amount of lost profits to be awarded either “in favor of John [Densmore] or in favor of the partnership as the court will determine at such time as the court considers everything that is going on and we deal with the other issues that are in this case.” (Italics added.) This is not a stray remark; it ties in with the other six factors that we have identified that show that it was the general understanding, shared by the jury, that, other than under the Lanham Act claim, the court would calculate lost profits.
We disagree with the dissent that Mandel’s aforesaid statement was a “passing comment by a lawyer in argument about which entity will get the money” and that this comment “cannot trump the instructions and verdict form” that come from the court and which therefore govern. This was not a comment about which entity would get the money, but a statement that the court would determine the amount of profits to be awarded. That this is what Mandel intended to say is shown by his earlier statement outside the presence of the jury that the court would deal with the disgorgement of profits and unjust enrichment. (See text, ante, p. 19.) Mandel’s statement could hardly have been more explicit. The fact that there was no objection to the statement shows that it reflected the general understanding that it would be the court that would determine the profits in the subsequent equitable accounting proceedings.
Standing alone, the circumstance that the jury made no monetary award to any of the litigants would be certainly a startling occurrence in a trial of this length, and following jury deliberations that took nearly a month. But the other factors that we have identified explain why this happened. There was never any doubt that respondents were seeking profits and not damages; midway during their deliberations, on September 13, 2004, the jury was told that the court would determine the profits (as it actually did) and there was no objection or contrary argument from appellants on this point; and the jury made no monetary award to anyone, even though it found several breaches to have been committed. It is inconceivable that the jury would have deliberated as long as it did, and returned verdicts as nuanced as its verdicts were, if it had concluded that no one had been harmed.
The dissent finds it plausible that the jury returned verdicts that found that appellants had breached their agreements with respondents but that it also found that these breaches resulted in no damages. The dissent reasons that this is so because the jury apparently viewed “all the litigants as having behaved badly.” This point of view is both conceptually and pragmatically unsound.
Conceptually, the jury was required to find that respondents had sustained harm as a result of appellants’ breaches. Having found harm, the jury could hardly find no damages, i.e., no lost profits. It is to be kept in mind that the jury was repeatedly told that harm in this case, if there was harm, was lost profits; in fact, the jury was again told this on September 13, 2004, during its deliberations, in response to its question about harm.
Indeed, whether respondents had sustained harm in the form of lost profits was a sharply contested issue. Appellants contended that since Densmore did not perform, he was not entitled to be paid; alternatively and additionally, appellants contended that, in light of the expenses, there really were no profits. This all added up to the fact, according to appellants, that respondents had not been harmed. Respondents claimed that the gross profits were between $8 million and $9 million, that the net was around $2.5 million or $2.7 million, and that appellants were not entitled to keep all of these profits for themselves; there was, in other words, harm and the harm was lost profits. Thus, whether respondents had been harmed was extensively litigated, with the position of the litigants clearly and emphatically drawn. The jury had to face and resolve this issue; there was no way of avoiding it. The fact that the jury asked about “harm” during its deliberations only confirms that the jury did in fact address the issue. Thus, the verdicts that appellants breached their agreements with respondents means that the jury concluded that there was harm, i.e., that there were profits to which respondents were entitled.
Contrary to the dissent, it was not the court but the jury that found that appellants had harmed respondents. It is therefore not true, as the dissent states, that it was the trial court’s conclusion of “harm” that resulted in the court disregarding “the jury’s award of zero damages on an indisputably legal claim for breach of contract.” The jury itself found that there was harm and the trial court’s award of lost profits carried that finding into effect.
Pragmatically, it seems highly unlikely that the jury would deliberate as long as it did, and render verdicts as nuanced as these verdicts were, if in fact the jury concluded, as the dissent suggests, that no one should recover anything. There would have been a far simpler, and quicker, way of accomplishing that objective.
It is also true that there is nothing unusual about the circumstance that the calculation of profits was deferred to a later, equitable stage of the proceedings. The determination of profits through an equitable accounting proceeding (5 Witkin, Cal. Procedure, supra, Pleading, § 775, p. 233) is standard and unexceptional. The trial court commenced those proceedings in its statement of decision when it set the timetable and ground rules for the accounting. As it turned out, a stipulation between the litigants covering the accounting made additional proceedings unnecessary.
In light of the foregoing, we find that the jury intended to, and did, defer the calculation of lost profits to the trial court. This was appropriate, since the determination of profits was left to the accounting proceedings on the equity side of the court, which were proceedings that were intended to take place after the jury’s verdicts had been returned.
The foregoing leaves unresolved the troublesome matter why the question “what amount, if any, do you award” for the breaches was left on the verdict forms--not once, but repeatedly. If, as we have concluded, it was the intention of all, i.e., the trial court as well as the parties, that the calculation of lost profits was to be performed by the court, the question “what amount, if any, do you award” should not have been left on the verdict forms.
It is of course true that respondents should have objected to the presence of this question and should have sought to have it removed from the verdict forms. Ultimately, however, it was the trial court’s responsibility to ensure that the verdict form in this complex case was free of ambiguities and errors that might draw the verdicts into question. The only conclusion we can draw is that this was a serious oversight on the part of the trial court, in the first place, and the parties, in the second place. While we disagree, for reasons stated, with our dissenting colleague, the fact is that this oversight may well have undone the hard work of several months on the part of the trial court and counsel and, last but certainly not least, of a conscientious and committed jury panel.
Were it not for the compelling circumstances, which we have detailed, that show that it was everyone’s understanding that the calculation of lost profits was to be performed by the trial court in the accounting proceedings following the verdict, we would not reach the conclusion that we have reached.
2. The Jury Did Not Find That Respondents Sustained No Damages
Appellants contend that the jury “found that [appellants] were not liable on certain claims and that [respondents] suffered no damages on other claims as to which the jury concluded there was liability.”
This contention is mistaken in its premise; the jury did not conclude that respondents suffered no damages on claims on which respondents recovered.
As we have discussed in part 1 of the Discussion, ante, each of the claims on which respondents recovered required that the jury find that respondents had been harmed by appellants’ breaches; harm was an essential element of each of these causes of action. Nor did the jury ignore or disregard this element, as the proceedings of September 13, 2004, make clear.
It is also true that the parties vigorously litigated the question whether respondents had sustained harm. And “harm” was defined throughout, and without equivocation, as loss of profits. Respondents presented evidence on loss of profits and energetically argued that there was such a loss, a contention that appellants disputed.
The jury, having found that respondents had sustained harm on the claims on which the jury found for respondents, reasonably concluded, as we have explained, that the court would determine at a later time what the net profits had been. In fact, this is precisely what the trial court did.
Thus, we reject the contention that the jury found that respondents had not sustained damages.
3. The Trial Court Did Not Disregard the Jury’s Verdicts
Appellants contend that the trial court disregarded the jury’s verdicts on the claims “triable at law” and that this is reversible error.
As before, the premise of this argument is mistaken; in all but three causes of action asserted in the cross-complaint, the trial court entered a judgment that is consistent with the jury’s special verdicts. We take up these three causes of action of the cross-complaint separately in part 4 of the Discussion, post.
First. The trial court entered judgment on the causes of action on which the jury found for appellants in conformance with the jury’s special verdicts. These were the first four causes of action in Densmore’s action and the first, second, third, fourth, sixth, eighth and ninth causes of action in the Estates’ action. Since the trial court followed the jury’s verdicts on these causes of action, for the purposes of addressing appellants’ argument it is unnecessary for us to decide whether these causes of action were legal or equitable in nature; the point is that the judgment on these claims conformed to the verdicts.
Respondents correctly point out that generally actions involving fiduciary duties are equitable (Interactive Multimedia Artists, Inc. v. Superior Court (1998) 62 Cal.App.4th 1546, 1555) and that the nature of the remedy sought determines whether an action is equitable, even if there is an additional prayer for damages. (C & K Engineering Contractors v. Amber Steel Co. (1978) 23 Cal.3d 1, 9, 11.) Here, respondents sought an accounting and a constructive trust imposed on profits earned by appellants, both of which are equitable remedies. (Van de Kamp v. Bank of America (1988) 204 Cal.App.3d 819, 863, 865 [accounting]; Getty v. Getty (1986) 187 Cal.App.3d 1159, 1176 [constructive trust].)
Second. The fifth cause of action of the Estates’ cause of action for false advertising in violation of Business and Professions Code section 17500 was an equitable claim on which the jury did not return a verdict. On this claim, the trial court found for the Estates and issued an injunction barring use ofThe Doorsname and logo.
Third. The two claims on which the jury returned a verdict for Densmore were the fifth cause of action for breach of the New Doors Agreement and the sixth cause of action for breach of fiduciary duty. Here, the premise of appellant’s contention is that the jury’s decision not to award any damages exonerated appellants, i.e., that the decision not to award damages effectively nullified the verdicts finding appellants liable on these claims. We have already explained why this premise is mistaken. The trial court correctly entered judgment for Densmore on these claims, deferring a determination of profits to the accounting, which is an equitable proceeding.
Fourth. The two causes of action on which the jury returned verdicts in favor of the Estates were the sixth cause of action for a violation of Morrison’s rights under Civil Code section 3344.1 and the 10th cause of action for breach of fiduciary duty. The jury did not find any damages under the Civil Code section 3344.1 claim. The statute required the court to award the greater of $750 or actual damages; the court awarded $750, as it was required to do. (See fn. 14, ante.) On the 10th cause of action, appellants’ contention that the jury’s failure to award monetary damages exonerated them from the contrary verdict on liability under this claim is without merit for reasons previously stated.
Fifth. The causes of action for the imposition of a constructive trust for the profits earned by appellants and the cause of action for an accounting in the Estates’ action are concededly equitable claims on which the jury did not return verdicts.
This cause of action is misnumbered as the 10th cause of action in the Estates’ complaint. It should be No. 11, making the accounting claim No. 12, and not 11.
Thus, the judgment that was entered in the principal action was consistent with the verdicts returned by the jury.
4. The Trial Court’s Disposition of the First Three Causes of Action of the Cross-complaint Was Correct
The jury found for appellants on the first three causes of action of the cross-complaint. The fourth cause of action of the cross-complaint was dismissed prior to trial (see fn. 15, ante), the jury held against appellants on the fifth cause of action (Bus. & Prof. Code, § 17200), and the court held against appellants on the remaining two causes of action (declaratory relief and reformation), which did not go to the jury.
The trial court did not follow the jury’s verdicts on the first three causes of action. These were causes of action for breach of fiduciary duty (first), breach of the covenant of good faith and fair dealing (second) and for promissory estoppel (third). In each instance, the jury returned a “$0” to the question “what amount, if any, do you award.”
We have set forth the trial court’s reasoning on these three causes of action. (See text, pp. 24-25, ante.) The first two causes of action are legal in nature, in that appellants sought damages. Thus, the trial court was bound by these verdicts, were it not for the fact that the jury returned a verdict of “$0” damages for these breaches. It is well settled that a breach of contract is not actionable without damages. (Bramalea California, Inc. v. Reliable Interiors, Inc. (2004) 119 Cal.App.4th 468, 473; Patent Scaffolding Co. v. William Simpson Constr. (1967) 256 Cal.App.2d 506, 511.) The trial court analyzed whether appellants were entitled to equitable relief on the first two causes of action and concluded that they were not entitled to this type of relief, a conclusion appellants do not challenge. Thus, since no damages were awarded on the first two causes of action, the trial court was required to enter judgment for Densmore on these claims.
We do not agree with the dissent that the trial court applied a different rule to these causes of action of the cross-complaint than it applied to the complaint. As a concept, “harm” under the complaint meant one thing and one thing only: lost profits. On the other hand, “harm” under the cross-complaint could mean only damages. The difficulty with damages under the cross-complaint, however, was that appellants operated their band at a profit. Thus, appellants simply could not show that they had been damaged by Densmore’s conduct. The jury so found, and the trial court drew the correct legal conclusion from that finding.
The trial court concluded that the cause of action for promissory estoppel, asserted as the third cause of action in the cross-complaint, was an equitable claim. The trial court correctly concluded that this is an equitable claim and that the verdict was therefore advisory only; that Densmore had laid down two conditions for the Harley-Davidson concerts, which were that the band’s name be clearly modified to reflect that it was not The Doors and that the new band would not use The Doors logo; and that neither condition had been met. The trial court therefore entered judgment for Densmore on this claim.
“[T]he complaint seeks relief which was available only in equity, namely, the enforcement of defendant’s gratuitous promise to perform its bid through application of the equitable doctrine of promissory estoppel.” (C & K Engineering Contractors v. Amber Steel Co., supra, 23 Cal.3d 1, 9.)
We agree with the trial court’s analysis and disposition. It is well settled that equitable estoppel is an equitable doctrine for the court and not the jury to apply and decide. (See generally 13 Witkin, Summary of Cal. Law (10th ed. 2005) Equity, § 190 et seq.) Appellants contend that if estoppel is asserted as a defense, as it was in this case, estoppel is a matter for the jury. This argument is mistaken. Estoppel is not the same as promissory estoppel; the trial court addressed a claim of promissory estoppel, and not the defense of estoppel.
Thus, we conclude that the trial court’s disposition of the first three causes of action of the cross-complaint was correct.
5. The Jury Did Not Find That There Were No Lost Profits
Appellants contend that since the only evidence of damages was evidence of lost profits, and since the jury did not return a monetary award, the only conclusion possible is that the jury concluded that respondents sustained no damages, i.e., that there were no lost profits.
The flaw in this contention is that it is unrealistic; it is not based on what actually occurred during the trial and the jury’s deliberations.
First. This argument ignores that respondents’ counsel Mandel told the jury midway during the month-long jury deliberations that the amount of profits would be determined by the court. This Mr. Mandel did without objection or contrary argument from appellants’ counsel. When Mr. Mandel made exactly the same comment immediately prior to his argument to the jury, there was no objection from appellants’ counsel. Thus, it appears that it was the expectation of counsel on both sides that, if the jury found for respondents, net profits, if any, would be determined in the accounting proceedings.
Second. It is unrealistic to suppose that the jury would find appellants substantively liable but that, practically in the same breath, the jury would exonerate them. Given how long and conscientiously the jury deliberated, such a self-defeating verdict is simply implausible.
Third. Appellants’ contention is all the more implausible if one considers that to find appellants substantively liable, the jury also had to conclude that respondents had been harmed. This was true of every claim on which the jury found for respondents. Given the attention that the question of harm received, the only reasonable conclusion is that the jury actually addressed and resolved the issue whether respondents had been harmed by the breaches that the jury found appellants had committed.
Fourth. The somewhat uncertain state of evidence on the exact amount of the profits confirmed that this calculation would be performed later. While there was evidence of gross and net profits, there were a number of issues, such as the legitimacy of certain expenses, that needed to be resolved before profits could be calculated. Even Densmore and the Estates differed to some extent on what the net profits were. Thus, the jury could reasonably assume that what it was being told was in fact true, i.e., that profits would be calculated by the court at a later time. As it turned out, this is exactly what happened.
Fifth. Beginning with pretrial statements by respondents’ counsel, it was clear throughout that respondents were seeking a disgorgement of profits and not damages. To a lawyer, disgorgement of profits means the equitable remedies of a constructive trust and an accounting. Not once did appellants’ counsel object to the invocation of these equitable remedies; appellants based their defense on the theory that there had been no profits, not that these remedies were unavailable as a matter of law if there had been profits. Thus, appellants’ counsel was perfectly aware of the fact that if the jury found appellants to be liable, there would be an accounting after the verdict.
In short, all counsel, the trial court and the jury were aware of the fact that if the jury found appellants liable, the net profits would be determined in a later proceeding, after the verdict. The jury’s decision not to award monetary damages was nothing more or less than a recognition of this fact.
Appellants’ misunderstanding of the record is reflected in their argument: “The jury found [appellants’] conduct caused no harm (and no lost profits), determining that [respondents] suffered ‘$0’ damages.” There are three flaws in this argument. First, as we have noted, the jury had to find that appellants’ conduct caused harm in order for the jury to find appellants liable. Second, the jury did not find that there were “no lost profits.” Indeed, to find harm the jury necessarily found that there were lost profits, since that was the only form of “harm” presented. And, third, the verdict was not that respondents “suffered ‘$0’ damages” but that the jury did not return monetary awards, leaving the calculation of the award to the court.
6. The Trial Court’s Finding of a Violation of Business and Professions Code Section 17500 Is Affirmed
Appellants contend that the jury’s verdicts exonerating them of the claims for statutory and common law trademark infringement, unfair competition and violations of Business and Professions Code section 17200 are inconsistent with the trial court’s finding on the Estates’ fifth cause of action that use of the name The Doorsviolated Business and Professions Code section 17500. As appellants put the point, the jury was instructed that use of the names “The Doors” or “The Doorsof the 21st Century”had to be likely to cause confusion (trademark infringement) or was likely to deceive people into thinking that use of the names was authorized (unfair competition) or constituted unfair business practices (Bus. & Prof. Code, § 17200). According to appellants, since the jury found for appellants on these claims the court was precluded from entering judgment for respondents on the Estates’ fifth cause of action for deceptive advertising.
There are two reasons why we disagree with appellants. First, it is not necessarily true that the jury’s verdicts on the trademark, unfair competition and Business and Professions Code section 17200 claims are inconsistent with the trial court’s finding on the claim for misleading advertising. Second, even if there is an inconsistency between the verdicts and the court’s finding on the misleading advertising claim, the trial court was not bound by the verdicts since the trademark, unfair competition and section 17200 claims were equitable.
a. The Verdicts and the Trial Court’s Finding on the Misleading Advertising Claim Are Not Necessarily Inconsistent
We begin by noting that the Estates’ fifth cause of action was not submitted to the jury for decision, in that it is clearly is an equitable claim. Thus, the decisionmaker on this claim was the trial court, and not the jury.
We do not think that the trademark and unfair competition claims are substantively the equivalents of a claim arising under Business and Professions Code section 17500. Section 17500 is a fairly complex statute that prohibits, in the sale of goods and services, advertising that is untrue or misleading, and which is known, or which by the exercise of reasonable care should be known, to be untrue or misleading.
Business and Professions Code section 17500 provides: “It is unlawful for any person, firm, corporation or association, or any employee thereof with intent directly or indirectly to dispose of real or personal property or to perform services, professional or otherwise, or anything of any nature whatsoever or to induce the public to enter into any obligation relating thereto, to make or disseminate or cause to be made or disseminated before the public in this state, or to make or disseminate or cause to be made or disseminated from this state before the public in any state, in any newspaper or other publication, or any advertising device, or by public outcry or proclamation, or in any other manner or means whatever, including over the Internet, any statement, concerning that real or personal property or those services, professional or otherwise, or concerning any circumstance or matter of fact connected with the proposed performance or disposition thereof, which is untrue or misleading, and which is known, or which by the exercise of reasonable care should be known, to be untrue or misleading, or for any person, firm, or corporation to so make or disseminate or cause to be so made or disseminated any such statement as part of a plan or scheme with the intent not to sell that personal property or those services, professional or otherwise, so advertised at the price stated therein, or as so advertised. Any violation of the provisions of this section is a misdemeanor punishable by imprisonment in the county jail not exceeding six months, or by a fine not exceeding two thousand five hundred dollars ($2,500), or by both that imprisonment and fine.”
The trademark claim deals with the likelihood of confusion about the source of goods and services. An advertisement may be untrue or misleading without creating the likelihood of confusion about the source of goods and services. As an example, an advertisement that states that all doctors agree that brand X is a proven cure for the common cold is false but says nothing about the likelihood of confusion about the source of brand X. The unfair competition claim turns on whether use of the name The Doors is likely to deceive the public into thinking that usage of the name was authorized. Reference to the brand X hypothetical is again apropos. The statement that all doctors agree that brand X is a cure for the common cold has no connection with whether use of the name brand X was authorized. Advertising may be untrue or misleading without suggesting that the use of a name or label was not authorized.
As far as the claim under Business and Professions Code section 17200 was concerned, the jury was instructed that the coverage of section 17200 “is broad and sweeping, embracing anything that might be called a business practice that is unlawful or unfair.” The jury was instructed that it could find a violation of this provision if appellants were found to have done any of the following: (1) violated trademark law or the Lanham Act; (2) engaged in unfair competition; (3) engaged in unfair business practices; or (4) “engaged in unfair, deceptive, untrue or misleading advertising.” We refer to this instruction hereafter as the “section 17200 instruction.”
While there is a reference in the section 17200 instruction to untrue or misleading advertising, the jury was not instructed about the elements of untrue or misleading advertising in the terms of Business and Professions Code section 17500. As the text of the statute clearly reveals (see fn. 21, ante), untrue or misleading advertising as prohibited by section 17500 is a claim with several distinct elements. Among those elements is that the “statement” made in the advertisement must be known, or in the exercise of reasonable diligence should be known, to be untrue or misleading. This requirement of knowledge is only one of several elements of a claim under section 17500 on which the jury received no instructions whatsoever. Indeed, the jury received no instructions at all on section 17500, which was in keeping with the trial court’s correct view that this claim is equitable. Thus, the passing reference in the section 17200 instruction to untrue or misleading advertising did not tender for decision whether section 17500 was violated.
It is true, as the dissent notes, that it has been held that a violation of California’s false advertising law necessarily violates section 17200. (Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 210.) While this is true as an abstract proposition, it may be that a Business and Professions Code section 17200 claim will fail on its facts because some element of the unfair competition claim, which does not appear in section 17500, has not been made out. As an example, the jury may find that the conduct in question was not a “business practice” and hence not actionable under section 17200. While this is undeniably a close question, we cannot say that, on its facts, the section 17200 claim in this case is a duplicate of the section 17500 claim.
Committee on Children’s Television, Inc. v. General Foods Corp. examined whether a complaint alleged facts sufficient to constitute a cause of action.
For the reasons stated, we conclude that in this case the jury’s verdict on the Business and Professions Code section 17200 claim is not inconsistent with the trial court’s finding on the section 17500 claim. But, even assuming that there is an inconsistency, it is not fatal. As we explain in part 6.b., post, the section 17200 claim was equitable in nature. Thus, the jury’s verdict was only advisory and the trial court was empowered to disregard it.
The trial court’s findings on this claim unambiguously reflect that the court’s focus was on (1) advertisements that were (2) known to be untrue or misleading. The text of the court’s findings on this claim follows: “Counsel and the court agree that this is an equitable claim, removed from the jury’s consideration. The court finds that use of the name The Doors by [appellants] is a violation of B&P Section 17500. By engaging in advertising which prominently displayed the logo of The Doors, in The Doors’ well-known type font, and minimizing in a different font the words ‘21st Century’ or ‘of the 21st Century,’ coupled with the use of the outtake photograph from the Strange Days album cover, and further permitting the dissemination of radio and television ads prepared by Bill Young Productions that identified the band as The Doors and the tour as the 21st Century Live tour, the [appellants] have engaged in false advertising. [¶] . . . [¶] A permanent injunction shall issue in favor of the Estates and against Manzarek and Krieger enjoining them from using the name The Doors or any name containing the name The Doors, or using the name, voice or likeness of Jim Morrison to promote their concerts.”
We do not agree with the dissent that the trial court did not explain whether the advertising was false or, instead, true but misleading. The trial court found that the advertising was false. It was false because the advertising stated that appellant’s band was The Doors. But this was not true. Appellants’ band was just that, i.e., a band composed of appellants and one other person, but it was not The Doors. The dissent is perfectly correct that no one reading the advertisement would expect to see, based on the advertisement, Jim Morrison perform. But the advertisement did not state that Morrison would perform. The advertisement falsely stated that the band known as The Doors would perform.
Absent from this ruling is any determination of, or even comment about, any one of the trademark/unfair competition claims.
Accordingly, we conclude that the trial court’s findings in connection with the cause of action arising under Business and Professions Code section 17500 are not inconsistent with the jury’s verdicts on the trademark/unfair competition claims. It follows therefore that the trial court did not err in issuing the injunction prohibiting use of The Doorsname and logo.
b. The Trademark, Unfair Competition and Business and Professions Code Section 17200 Claims Were Equitable Claims
The broad rules under which it is determined whether an action is legal or equitable are well settled. “The historical test (supra, §114) is useful but not conclusive. New remedies are constantly being created by statute, and in their statutory form were of course unknown to the English court of chancery. To classify all new statutory remedies as legal, rather than equitable, would defeat the purposes of the classification. Accordingly the courts will consider the nature of the new remedy, and thus we have, in practice, a double test: First, look to the English practice for a classification of legal and equitable actions based upon certain differences in nature. Second, if the action is not one of those listed under the old classification, examine its nature and treat it as equitable if it resembles a traditional equitable remedy.” (3 Witkin, Cal. Procedure (4th ed. 1996) Actions, § 115, p. 181.)
Applying these familiar rules to the trademark, unfair competition and Business and Professions Code section 17200, we conclude that all of these claims are equitable in nature. Indeed, as far as the section 17200 claim is concerned, it has been held that there is no right to a jury trial in such a case. (Hodge v. Superior Court (2006) 145 Cal.App.4th 278, 285 [citing authorities].) As far as the trademark and unfair competition claims are concerned, respondents sought the remedy of an injunction, which “is a typical form of equitable relief, and an action in which injunctive relief is sought is a suit in equity. (See St. James Church of Christ Holiness v. Superior Court (1955) 135 C.A.2d 352, 361; [citation].)” (3 Witkin, Cal. Procedure, supra, Actions, § 121, p. 187.)
Since these claims were equitable in nature, the trial court was not required to follow the jury’s advisory verdicts on these claims. Thus, even if there is an inconsistency between the jury’s verdicts on these claims, and the trial court’s finding on the Business and Professions Code section 17500 claim, the inconsistency is not fatal to the trial court’s conclusion on the section 17500 claim.
7. The Jury’s Special Verdicts in Favor of Appellants on the Claims for a Breach of the Oral or Implied Old Doors Agreement Are Not Inconsistent with the Judgment
Densmore’s fourth cause of action was for a breach of the “oral” Old Doors Agreement, as was the Estates’ eighth cause of action. The ninth cause of action in the Estates’ complaint was for the breach of the “implied in fact” Old Doors Agreement. The jury found for appellants on these three causes of action; appellants contend that these special verdicts are inconsistent with the judgment entered by the court.
The jury returned a verdict for Densmore on his claim that appellants breached their fiduciary duties under the Old Doors and DMC Agreements, and a verdict for the Estates on the identical claim. (Respectively, these were the sixth and 10th causes of action.) Thus, the jury chose to enforce the Old Doors Agreement by concluding that appellants and respondents (1) had entered into the Old Doors partnership agreement and (2) that appellants breached their fiduciary duties under that agreement. The jury’s finding that there was no “oral” and/or “implied in fact” Old Doors Agreement is consistent with its finding that there was a written Old Doors Agreement, which appellants had breached.
There is no conflict or inconsistency between the verdicts on the “oral” and “implied in fact” Old Doors Agreement and the judgment because (1) the judgment rests on the verdict in favor of respondents on the breach of the written Old Doors Agreement; and (2) the jury’s verdicts on the “oral,” “implied in fact” and written Old Doors Agreement are consistent.
8. Appellants Are Not Entitled to a Judgment Notwithstanding the Verdict on the Estates’ Claim for a Violation of Morrison’s Postmortem Right of Publicity
Appellants contend that they were entitled to a judgment notwithstanding the verdict on the Estates’ claim based on Morrison’s postmortem right of publicity under Civil Code section 3344.1.
It is undisputed that Morrison’s name, voice and likeness were used by appellants’ band. While the precise characterizations of this use differ, the fact is that there is no question that Morrison’s name, image and voice were used by appellants. In any event, appellants’ contentions regarding this issue concede that Morrison’s name, voice and likeness were used by appellants.
As appellants phrase it: There was “the brief projection of a Morrison photograph at the start of some concerts, independent promoters’ use in concert advertisements of The Doors music in which Morrison’s voice could be heard, an image of Morrison holding a sparkler on a House of Blues website advertising one concert, and a fuzzy photograph of the four original band members in a photograph within a photograph in the background of a concert poster used at one performance.” As might be expected, respondents’ summary of the identical facts, which we find unnecessary to repeat here, does not minimize the exploitation of Morrison’s likeness and voice, as appellants’ summary does. In addition to a more pointed rendition of these facts, respondents also state that the promoters of appellants’ concerts were not independent but were controlled by appellants.
Appellants first contend that the use of Morrison’s image and voice was exempt under subdivision (a)(2) of Civil Code section 3344.1 because this use was part of a “musical work.” As respondents correctly point out, subdivision (a)(3) provides that the exemption of subdivision (a)(2) does not apply when, as here, the use constituted an act of advertising performances by appellants’ band. The trial court found that use of Morrison’s name, voice and likeness was part of the overall marketing plan to sell tickets for more than 65 concerts performed during approximately two years. The exemption provided by subdivision (a)(2) does not apply.
Subdivision (a)(2) of Civil Code section 3344.1 provides: “For purposes of this subdivision, a play, book, magazine, newspaper, musical composition, audiovisual work, radio or television program, single and original work of art, work of political or newsworthy value, or an advertisement or commercial announcement for any of these works, shall not be considered a product, article of merchandise, good, or service if it is fictional or nonfictional entertainment, or a dramatic, literary, or musical work.”
Subdivision (a)(3) of Civil Code section 3344.1 provides: “If a work that is protected under paragraph (2) includes within it a use in connection with a product, article of merchandise, good, or service, this use shall not be exempt under this subdivision, notwithstanding the unprotected use’s inclusion in a work otherwise exempt under this subdivision, if the claimant proves that this use is so directly connected with a product, article of merchandise, good, or service as to constitute an act of advertising, selling, or soliciting purchases of that product, article of merchandise, good, or service by the deceased personality without prior consent from the person or persons specified in subdivision (c).”
Appellants also contend that their use of Morrison’s name, voice and likeness was protected by the First Amendment. “We formulate . . . what is essentially a balancing test between the First Amendment and the right of publicity based on whether the work in question adds significant creative elements so as to be transformed into something more than a mere celebrity likeness or imitation.” (Comedy III Productions, Inc. v. Gary Saderup, Inc. (2001) 25 Cal.4th 387, 391.) In other words, if the likeness is part of a new creation, use of the likeness is protected by the First Amendment.
Appellants contend that their use of Morrison’s image was “. . . transformative. It helped transport the concertgoers to the time The Doors were at their zenith, the late ‘60s, without representing that Morrison, who died in 1971, would be appearing at the concert, which, of course, any Doors fan or reasonable attendee would know could not happen.”
This argument only confirms that appellants were exploiting Morrison to publicize their concerts in 2003-2004. The Doorsof the ‘60’s were in no sense a new creation of appellants’ band of 2003/2004. The only reason to “transport” concertgoers in 2003/2004 to The Doors“at their zenith” was to suggest that the 2003/2004 concerts were, in fact, concerts by The Doors. In that sense, exploiting Morrison was certainly “transformative”; it transformed appellants’ band of 2003/2004 into The Doors. But that is not the kind of transformation the court was referring to in Comedy III Productions, Inc. v. Gary Saderup, Inc. No original work was created by the use of Morrison’s likeness in 2003/2004, i.e., no original work was created with Morrison’s likeness becoming simply one of the components making up that new work. (Comedy III Productions, Inc. v. Gary Saderup, Inc., supra,25 Cal.4th at p. 406.) All that was created was the mendacious illusion that appellants’ band of 2003/2004 was The Doors.
There being no original work, exploitation of Morrison was not protected by the First Amendment.
The trial court did not err in denying appellants’ motion for a judgment notwithstanding the verdict.
9. Appellants Misconstrue the Trial Court’s Rulings on Respondents’ Motion for a Preliminary Injunction
Appellants contend that the judgment requires them to surrender $3.2 million in profits earned by them “in using the very group name--The Doors Of The 21st Century--that the trial court said they could use. There is nothing legal or equitable in such an incredibly unfair result.”
There are four serious flaws in this contention.
First. “[A] request for temporary equitable relief pending the determination of a case on its merits is an entreaty to the court to exercise its discretion and a ruling thereon is not a determination of the merits of the case.” (People ex rel. Bender v. Wind River Mining Project (1990) 219 Cal.App.3d 1390, 1395.)
Second. The purpose of a preliminary injunction “at least theoretically and usually in fact, [is] to preserve the status quo and prevent irreparable harm pending trial on the merits.” (Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2007) ¶ 9:558, p. 9(II)-17 (rev. #1 2007).) We have already noted that, at the time the trial court ruled on the motions for a preliminary injunction, it was required to deal with scheduled performances that had already been advertised. Thus, in April and May 2003 the preservation of the status quo, and the prevention of serious harm to appellants who had committed to the performances, necessarily inclined the trial court to allow the performances to go forward as advertised, especially since the advertisements had already run. In short, the trial court was faced with facts and circumstances in April and May 2003 that were immaterial when it came to the judgment on the merits of the case.
Third. While appellants were permitted to use the name The Doorsof the 21st Century by the order denying the preliminary injunction, they should have done so in good faith, and in the terms of the court’s order. Instead, as the trial court found in ruling on the claim under Business and Professions Code section 17500, appellants used the famous logo and prominent type font for The Doors and minimized in small font “of the 21st Century.” (See text, ante, p. 33.) In other words, appellants sabotaged the trial court’s order permitting them to use the name The Doorsof The 21st Century. We say sabotaged because the visual impact of The Doorsof the 21st Century, especially when the qualifier is removed from The Doors and is on a different line, is quite different from the one permitted by the court’s order.
Fourth. Appellants continue with their misplaced strategy even in this appeal. In their opening brief, they claim that they toured asThe Doorsof the 21st Century, ignoring the fact that they used the large and traditional font for The Doorsand a small font for the qualifier.
Given that the ruling on the preliminary injunction was not a ruling on the merits and that appellants did all they could to subvert the court’s pretrial ruling, we find nothing “unfair,” much less “incredibly unfair” in the result.
We would reach the same conclusion even if appellants had complied with the letter and spirit of the court’s order and toured as The Doorsof the 21st Century. Appellants knew that use of The Doorsname and logo was in litigation and that the result could be adverse for them. Thus, they used The Doorsname at their peril, which they could have avoided by not using it. To suggest that the court’s order of April/May 2003 somehow gave them a license to use The Doors name is to assume, entirely mistakenly, that that order was a ruling on the merits. That order did nothing other than stabilize a difficult and dynamic situation in the spring of 2003.
10. Appellants Were Not Entitled to Compensation Other Than Their Share of the Profits
Appellants contend that it was inequitable for the trial court not to award them compensation, over and above their share of the profits, for their work on the 2003/2004 tour.
In the absence of a provision in the partnership agreement, general partners cannot recover special compensation for services performed on behalf of the partnership. (Broffman v. Newman (1989) 213 Cal.App.3d 252, 258.)
Appellants acknowledge this rule, but claim that the trial court should have taken account of “workload disparity,” especially since Densmore did not participate at all in the 2003/2004 tour.
We find this point of view unpersuasive. The trial court’s function was not to balance the workload, but to balance the equities. Appellants’ decision to perform in 2003/2004 as The Doors was made in the teeth of Densmore’s adamant opposition, which was of course known to appellants and which, given the history of The Doors and Densmore’s attitude toward that history, did not come as a surprise. Appellants well knew the depth and extent of Densmore’s opposition but nevertheless decided to tour as The Doors. They are therefore in a poor position to complain that they did not receive extra compensation for work that Densmore found highly objectionable and that, as it turns out, Densmore was right in finding highly objectionable.
The result may have been different if the 2003/2004 tour went forward with everyone’s blessing and if Densmore nonetheless did not participate in the tour. But that is not what happened, and not the scenario that the trial court was required to address.
11. Appellants Misconstrue the Terms of the Permanent Injunction
Appellants contend that the permanent injunction “precludes [appellants] from using any name that includes the words The Doors,” that this injunction is overbroad and that it therefore violates the First Amendment. Appellants go on to claim that they cannot tour as “The Doorsfeaturing only Ray Manzarek and Robbie Krieger” or “Two ofThe Doors.” (Italics omitted.)
Appellants have misconstrued the permanent injunction. In relevant part, the injunction provides: “The granting of this permanent injunction does not prevent Krieger and Manzarek from identifying themselves as the founding or original members of The Doors as long as: 1) the names Krieger and Manzarek be listed first either to the left or above any other wording; 2) the words ‘original’ or ‘founding’ and ‘members of The Doors’ are in the same or smaller type font size than the names Krieger and Manzarek; and 3) the name The Doors is not displayed in the classic Doors logo which is the round letters with the diagonal intersections and the ‘wavy gravy’ font for the word ‘the’ displayed on The Doors debut record in 1967 or any font similar in style to the classic Doors logo.”
It is evident that appellants can use the words “The Doors” as long as they adhere to the very specific guidelines of the permanent injunction. Appellants can identify themselves as founding or original members of The Doors and can use the words “The Doors” in the process of doing so. Manzarek and Krieger, however, cannot identify themselves as The Doors. All of which boils down to the fact that Manzarek and Krieger can truthfully state that they are founding or original members of The Doors but cannot misrepresent themselves as The Doorsband. While even at this late date appellants strive to identify themselves as The Doors, that name and logo attaches legitimately only to the band composed of Manzarek, Krieger, Densmore and, importantly, Morrison.
As an example, appellants suggest they should be allowed to style themselves “The Doors featuring only Ray Manzarek and Robbie Krieger.”
We see nothing overbroad in the terms of this injunction.
12. The Prohibition of Using Morrison’s Name, Likeness, Voice or Image To Promote Appellants’ Ban Is Valid
Appellants contend using Morrison’s photos is “merely an adjunct of [appellants’] performances” and that this use is nothing more than an accurate reflection of the historical fact that Morrison was a member of The Doors.
The pertinent part of the injunction provides: “Effective immediately, [appellants] Raymond Manzarek and Robert Krieger are hereby permanently enjoined from using the name, likeness, voice or image of Jim Morrison to promote their band or their concerts.”
As before, appellants misconstrue the terms of the injunction. From an artistic or musical perspective, briefly displaying a photograph of Morrison during or immediately prior to a concert adds nothing to the performance and is, in fact, not a part of the performance. The only reason to display a photograph of the iconic Morrison is to suggest that the band is a continuation of his work and artistry--in short, to add Morrison’s luster to the band and thus to profit from his name and likeness. But this is exactly the kind of use that Civil Code section 3344.1 prohibits.
The injunction does not enjoin the use of Morrison’s likeness for any legitimate purpose, such as an account of the history of The Doors, or in telling the story of 20th century rock and roll. The only act it prohibits is using Morrison’s name and likeness to promote appellants’ band or their concerts. This is an entirely appropriate, narrowly drawn objective that is fully supported by the jury’s verdict that appellants violated Morrison’s rights under Civil Code section 3344.1.
13. The Jury’s Special Verdicts, the Trial Court’s Statement of Decision and the Judgment Form a Coherent and Internally Consistent Disposition of This Controversy
The first line in appellants’ opening brief is: “It was as if a nine-week jury trial never happened.” After this start, appellants stress throughout their presentation their view that the trial court effectively nullified the verdict, which, according to appellants, was in sum and substance in their favor.
In large part, appellants’ claim that they prevailed at trial is predicated on the jury’s responses to the verdict form’s question “what amount, if any, do you award.” Were it not for the compelling circumstances that show that it was understood that the amount of lost profits would be calculated in the postverdict, equitable accounting proceedings, appellants’ argument would not be off the mark. This said, we find that the proceedings below were coherent, internally consistent and resulted in a fair and equitable judgment.
We begin with the fact that the jury’s special verdicts seized on the critical aspects of the controversy, and resolved them adversely to appellants. These were the jury’s findings that appellants breached the New Doors Agreement between themselves and Densmore and that they breached their fiduciary duties toward respondents, their partners under the Old Doors and DMC Agreements. The meaning and significance of these findings is that appellants breached their obligations vis-à-vis respondents under the only legal instruments that mattered, which were the agreement governing The Doorsprior to Morrison’s death, and the agreement that went into effect after his death. The finding under Civil Code section 3344.1 supports the foregoing result.
After the jury found that appellants had breached both the Old and New Doors Agreements, the remaining causes of action were, for the most part, duplicative or, if not duplicative, ancillary and not central to the actual controversy, which was the meaning and effect of the two principal Doorsagreements.
This emerges clearly from the circumstance that the jury’s general verdicts on the various causes of action are not inconsistent. In part 7 of the Discussion, we explained why the jury’s verdicts in appellants’ favor on the “oral” and “implied in fact” Old Doors Agreements are consistent with the verdict for respondents for the breach of the written Old Doors Agreement. The remaining verdicts in favor of appellants involve causes of action with elements that are quite distinct from the relatively simple and straightforward causes of action for breach of the (written) Old and New Doors Agreements. The jury could legitimately and correctly conclude that these relatively specialized claims (see fn. 26, ante) were not supported by the evidence, without implicating the finding that appellants had breached the written Old and New Doors Agreements.
These are causes of action arising under the Lanham Act, Business and Professions Code section 17200, and the unfair competition and trademark claims.
The fact that the jury, deliberating for nearly a month, was able to and did distinguish between these multiple claims is a credit to this particular jury.
Continuing with the circumstance that the jury did not return any monetary awards, we have already set forth at length in part 1 of the Discussion that the jury did so because it believed, correctly, that the court would calculate loss of profits. The fact that the jury returned no monetary award on the cross-complaint is explained by the fact that the jury found that appellants had profited by their breaches; to the extent the jury found that Densmore breached his obligations, the profits gained by appellants meant that they had not sustained losses as a result of Densmore’s breaches.
It is also true that the trial court entered a judgment that, with one exception, incorporated all of the jury’s verdicts. That exception was the claim in the cross-complaint based on promissory estoppel. The trial court’s disposition of this claim was correct, as we have explained in part 4 of the Discussion. In any event, a difference of opinion on one claim in a case of this complexity is a minor matter. As far as the first and second causes of the cross-complaint are concerned, since the jury found that appellants had not sustained damages under these causes of action, the court was required to enter judgment for Densmore on these claims.
The fundamental fact is that the judgment is congruent with the special verdicts.
The monetary awards entered by the trial court were based on solid evidence and, as we have observed, the injunctive relief was precise, narrowly tailored and goes to the heart of the matter.
DISPOSITION
The judgment is affirmed. Respondents are to recover their costs on appeal.
I concur: COOPER, P. J.
Judge of the Los Angeles County Superior Court, assigned by the Chief Justice pursuant to article VI, section 6, of the California Constitution.
I concur in the result in part 8 of Discussion in the majority opinion. From the rest of the opinion, I respectfully dissent.
SUMMARY
John Densmore, the former drummer of The Doors,sued his band-mates Raymond Manzarek, the keyboard player, and Robert Krieger, the guitarist. Manzarek and Krieger had asked Densmore to tour and perform with them but Densmore said no. Manzarek and Krieger toured without Densmore, performing as The Doors and The Doors of the 21st Century. Densmore filed this lawsuit, alleging breach of various partnership agreements, trademark infringement, and unfair competition. The legal heirs to the Estate of Jim Morrison – the lead singer of The Doorswho died in 1971 – also sued Manzarek and Krieger, asserting similar claims.
A jury heard evidence during a trial that lasted more than eight weeks. The jurors deliberated almost a month; then they returned their verdicts. They found against Densmore and the Morrison parties on their trademark and unfair competition claims. The jury decided that Manzarek and Krieger had breached their written contract with Densmore, but they awarded Densmore no monetary relief. The jury put a zero in the blank space on the verdict form that asked “what amount, if any, do you award?” The trial court disregarded that verdict, however, and awarded Densmore and the Morrison parties more than $3.2 million.
The claims Densmore and the Estate heirs asserted were legal claims. Manzarek and Krieger therefore were entitled to a jury trial. That jury trial right means the jury’s verdict is entitled to dignity, and it must govern. The trial court cannot ignore or eviscerate the jury’s decision. The invalidation of the jury’s verdict was error, and reversal is required.
PROCEDURAL HISTORY
A. The Complaints and Cross-Complaints
In his Second Amended Complaint dated July 31, 2003, John Densmore sued as an individual and on behalf of the Doors Music Co. partnership and the “Old Doors partnership.” Densmore alleged causes of action for violation of the Lanham Act (15 U.S.C. § 1125(c)(1)), common law unfair competition, unfair competition in violation of California Business and Professions Code section 17200, breach of oral partnership agreements; breach of the 1971 “New Doors” written contract, and breach of fiduciary duty. Densmore requested an injunction; an accounting and the payment to himself “and/or” the partnerships of “all gains, profits, and advantages” Manzarek and Krieger had acquired in performing; and “such damages as [he and/or the partnerships] [had] sustained by reason of the Defendants’ breach of the Doors Music Co. and Old Doors oral partnership agreements, their breach [of] the 1971 partnership agreement, and their breaches of fiduciary duty.”
Defendants Raymond Manzarek and Robert Krieger cross-complained, as individuals and on behalf of “several California general partnerships.” They alleged breach of fiduciary duty, breach of the implied covenant of good faith and fair dealing, promissory estoppel, intentional interference with economic advantage, and violation of Business and Professions Code section 17200. They also sued for declaratory relief and reformation of the 1971 partnership agreement. Manzarek and Krieger prayed for general and special damages, restitution, and an injunction.
Manzarek and Krieger dismissed this cause of action before trial.
Jim Morrison’s successors in interest also sued Manzarek and Krieger. Their lawsuit was transferred to the court handling Densmore’s case. The plaintiffs were Morrison’s parents, George and Clara Morrison, and the parents of Pamela Courson, Morrison’s deceased companion, Columbus and Pearl Courson (collectively “the Estates”). The Estates’ Second Amended Complaint, filed March 2, 2004, alleged causes of action for trademark infringement in violation of the Lanham Act, common law trademark infringement, unfair competition, violation of Business and Professions Code section 17200, false advertising in violation of Business and Professions Code section 17500, state law trademark dilution in violation of Business and Professions Code section 14330, violation of the statutory right of publicity for deceased individuals (Civ. Code, § 3344.1), breach of contract, breach of implied-in-fact contract, and breach of fiduciary duty. The Estates asked the court to impose a constructive trust. The Estates also sought an injunction, an order that Manzarek and Krieger “deliver for destruction” any products that violated the Estates’ trademarks, an accounting and the payment of “gains” and “profits” from sales of products and performances, “compensatory damages according to proof” at trial, and other statutory damages.
B. The Jury Trial and the Untimely Motion for a Court Determination of Equitable Claims
After nearly 17 months of discovery, trial began before a jury on June 29, 2004. In his opening statement, Densmore’s attorney, Jerome Mandel, told the jury:
“We believe that the mark and the name and the legacy of ‘The Doors’ has been harmed. We don’t want damage for the harm. We’re not going to ask you to value how much the catalogue has gone down. But we do think that when these partners without proper authority take the asset of this partnership for themselves, it’s wrong. It’s a theft. It’s a misappropriation. It’s identity theft. [¶] And we do want them to give to the partnership of four the revenues that they’ve made by using this name because it’s not right for them to keep it. They didn’t have the right to use it. That’s what we want, ladies and gentlemen. And you’ll see the numbers. You’ll see the grosses. The millions and millions of dollars that are involved. We think it’s a clear, clear violation of the law and a violation of their agreements, their agreements for 40 years.”
Manzarek and Krieger’s attorney, William Briggs, told the jury in his opening that Densmore not only was “asking [Manzarek and Krieger] to stop the use of the name,” but that he also was “trying to get money, money that they have earned.” Densmore, he said, was going “to ask [the jurors] to take money out of [Manzarek and Krieger’s] pocket and give it to him.”
At the end of July 2004, after trial had been underway for about a month, Densmore and the Estates filed a “motion to have equitable issues first determined by court.” Manzarek and Krieger filed an opposition brief on August 5, 2004. About a week before Densmore and the Estates filed their motion, Mandel mentioned the issue for the first time:
Mr. Mandel: “ . . . . [I]t’s not something for discussion. I just wanted to sort of invite the court to think about the problem ‘cause frankly I don’t – not the problem, the issue – I don’t think I’ve ever faced it in my 33 years. But as we were going through my office trying to start to put together the jury instructions, . . . we’ve become pretty satisfied. And maybe it’s subject to debate, I don’t know, but we’ve become pretty satisfied that almost every claim in this case is equitable and is to be decided by the court. It’s possible, possible, that a couple of the cross-complaints, claims by the cross-complainants, depending on how things are phrased, could be jury issues. But regardless of whether that’s the case or not, there clearly are many issues that are equitable issues that will require the court to make those equitable determinations first before the jury acts on the nonequitable claims. . . . [¶]
The Court: Are you just telling the defense for, this for the first time?
Mr. Mandel: Yeah. I
Mr. Briggs: Absolutely.
Mr. Mandel: Yeah. I mean
Mr. Briggs: And we strongly disagree with the characterization.
Mr. Mandel: Well, that -- and it may be that there’s things that need to be discussed about that.
The Court: Okay.
Mr. Mandel: I mean, certainly, we’ve all know[n] that at some point there are equitable claims. We may differ as to which of them they are.
The Court: Okay.
Mr. Mandel: Our understanding of the law . . . is that where equitable relief is sought, that’s what’s going to dictate whether or not they are issues of fact for the jury or not. And since in this case what we seek for the most part are equitable remedies of disgorgement and restitution, constructive trusts, those kinds of things, the court may find itself having to make more decisions than it may have thought. It may want the jury to do advisory findings. I don’t know. I’ve never been in an advisory-finding thing. And I’m not inviting a discussion necessarily. It just last night . . . [¶] . . . when we focused on this that it was prudent for us to say to you as soon as we knew that we thought that was an issue that would sometime have to be wrestled with.
The Court: Okay.
Mr. Briggs: Well, Your Honor, I don’t have the complaint before me, I don’t have the cross-complaint before me, and I don’t have the Estates[’] complaint, so I would have to go through them to make an analysis of that situation.
The Court: Okay.”
The next day, Mark Hurwitz, a lawyer for the Pamela Courson Estate, testified at trial. On cross-examination, Hurwitz was asked about what the Estates were seeking in their lawsuit:
“[Mr. Briggs:] And your clients . . . they’re here because they’re fighting for money, aren’t they?
[Mr. Hurwitz:] No. They’re fighting for what is prayed for in this complaint. There’s several remedies sought in the complaint. And I think it speaks for itself. . . . They’re seeking to prevent this theft of the name and logo. [¶] They’re seeking a disgorgement of profits that have been made by Mr. Densmore [sic] and -- by Mr. Manzarek and Mr. Krieger through what we consider to be the wrongful use of assets that they don’t own individually. [¶] And they’re seeking the damages provided by statute for these violations as well as an order preventing the continued use of assets that don’t belong to them individually.
[Mr. Briggs:] Your clients want a disgorgement of profits. What does that mean?
[Mr. Hurwitz:] That means that any profits that have been made by Mr. Krieger and Mr. Manzarek through the use of assets that didn’t belong to them that rather belonged to the partnership should be paid to the partnership . . . .
[Mr. Briggs:] That means they want the money from my clients going out touring and performing; right? [¶] . . . [¶]
[Mr. Hurwitz:] And they want . . . their share of whatever monies have been taken from the partnership by virtue of the use of this name and logo. [¶] . . . [¶]
[Mr. Briggs]: Sir, your clients are in this court asking this jury to disgorge profits. That means they want money in their pocket, doesn’t it?
[Mr. Hurwitz]: To the extent that they had appropriated partnership assets to their own benefit, the answer is yes.”
The trial went on. About two weeks after Densmore and the Estates filed their motion for the court to decide the equitable issues, Briggs asked the court when it wanted to discuss the matter, noting that Manzarek and Krieger had filed opposition. The court confirmed that it had received the opposition but did not set a time to discuss the issue or to hear the motion.
C. Jury Instructions and Closing Arguments
On August 25, 2004, after more than eight weeks of trial, the court and counsel discussed jury instructions. The record contains an undated minute order:
“The Court has reviewed both stacks of proposed jury instructions. This Court requires joint jury instructions and the non rejected stack needs to be crafted into joint instructions. The Court has put the instructions that haven’t been rejected in the black notebook which counsel will need to edit, harmonize, or delete if agreement can be made among the substantially similar instructions offered by opposing counsel. The Court will review the joint instructions at 1:30 p.m. [¶] . . . [¶] The Court will have the jury decide the legal issues first along with advisory findings regarding equitable issues. Counsel are to meet and confer and submit a proposed special verdict form with advisory findings at 1:30 p.m.”
Counsel told the court on August 25 that they had been working on the instructions and had agreed on a number of them but that they had “not attempted yet at all to discuss the special verdict form.” Briggs noted that the court had rejected 48 of the proposed instructions. (Except for 12 proposed and rejected instructions attached to Manzarek and Krieger’s Notice of Refused Jury Instructions, the record does not reveal what instructions any party requested that the court did not give.) There was no further discussion of the “legal versus equitable” issue. All agreed that counsel would continue to work on the instructions overnight.
The jurors returned the next day. The court explained that only some of the jury instructions were ready. The court read those instructions to the jury and then excused them for the day. The next day, with the jurors waiting, the court and counsel discussed the instructions some more. There still was no discussion of which issues and claims were legal and which were equitable, or which matters the jury would decide and which the court would decide. Counsel then argued nonsuit motions. The court brought in the jurors, read the rest of the instructions to them, and excused them for the weekend.
In the instructions, the court told the jurors that they were to decide “whether or not one or more partnerships existed in this case,” who the partners were, how they had decided to make decisions for the partnership(s), and whether the partnerships still existed. The court gave the jury a number of instructions on the trademark claims, including one entitled “Trademark Damages – Defendants’ Profits.” The court told the jury, “Plaintiffs have elected not to seek such damages. [There seemed to be no antecedent to “such.”] Instead, plaintiffs seek two other remedies available to them. These are injunctive relief and defendants’ profits. [¶] In lieu of actual damages, the plaintiffs, or the partnerships on whose behalf they have sued, are entitled to any profits earned by the defendants that are attributable to the infringements which the plaintiffs prove by a preponderance of the evidence.” The instructions went on to explain the calculation of profits (gross revenue minus expenses), apportionment of gross profits, and permissible and impermissible deductions. The court instructed the jury, “After you have calculated the amount of the defendants’ net profits attributable to the infringement, you may award the plaintiffs or the partnerships on whose behalf they sue, an amount greater than the net profit amount under certain circumstances[,]” for example, if the “calculations [were] imprecise . . . due to the defendants’ conduct.”
On Densmore’s and the Estate’s claims for breach of contract, the court gave the jurors CACI No. 300, as modified. That instruction laid out the parties’ contentions, including the plaintiffs’ claim that “breach of the oral or implied partnership agreements caused them harm for which defendants Ray Manzarek and Robby Krieger should pay.” The court also gave the jury CACI No. 303, as modified. It instructed them that, to “obtain relief from defendants” for breach of contract, Densmore and the Estates had to prove five elements; element five was that they “were harmed by [Manzarek and Krieger’s] failure” “to do something that the contract required . . . them to do . . . .”
This jury instruction, entitled Essential Factual Elements – Written Agreement, started out talking about the 1971 written partnership agreement. At page two the instruction went on to discuss the alleged “oral or implied” partnership agreements.
The court apparently did not give the jury CACI No. 360 on nominal damages for breach of contract. The record does not reveal whether any party asked for this instruction.
The court also instructed the jury on “damages for misappropriation of name or likeness” on the Estates’ cause of action for violation of the post-mortem right of publicity. The instruction explained that “damages” was “money [in an amount that would] reasonably compensate [the Estates] for their harm.”
On Manzarek and Krieger’s cross-claim for breach of the covenant of good faith, the court gave the jury CACI No. 325, as modified. It explained that the cross-complainants had to prove five elements, including “harm” from Densmore’s conduct.
On Monday, August 30, and Tuesday, August 31, 2004, counsel presented closing arguments. Mandel told the jury that Manzarek and Krieger had stolen from the partnership and that they should have to “give the money back.” Mandel argued that Manzarek and Krieger had “made a bundle,” “a small little fortune,” that they had “grossed $ 8 1/2 million.” Mandel asked the jurors to look at the exhibits concerning Manzarek and Krieger’s concert performances; he said they had “made $2.2 million from touring activities,” $300,000 from a European production, and $250,000 in tax credits. Mandel told the jurors that Manzarek and Krieger “should be compelled to give up the profits they made in favor of the partnerships who own the identity they have stolen”: “That’s the law. That’s the right thing to do. And that’s what we ask you to do.”
Jeffrey Forer, counsel for the Estates, told the jury that his clients had been “harmed” in monetary terms, that Manzarek and Krieger “owe[d] [the Estates] at least $400,000,” and that the jurors should “make them pay.” Forer referred the jurors to exhibits showing receipts and expenses for the concert tours and said that Manzarek and Krieger had grossed “close to $9 million in total.” Forer then spoke at length about the revenues, expenses, and calculations, recalling exhibits and testimony and challenging Manzarek and Krieger’s profits calculation.
In his closing on behalf of Manzarek and Krieger, Briggs disputed the plaintiffs’ profit calculation. Briggs said, “[T]hey’re asking you to award Mr. Densmore [$] 3.3 million or $3.5 million.” But, Briggs argued, Manzarek and Krieger “put in their pockets” only $439,000 each.
Closing arguments continued on September 1, 2004. Before the jurors were brought in, Mandel told the court that he was “becoming more and more intrigued with the idea of a simple general verdict with respect to each cause of action.” Mandel said that the verdict form was “tied into what you think are equitable and not equitable. What you’re going to ultimately decide on yourself as opposed to the jury.” The court noted that it “did have that thought also.” The court again urged counsel to try to agree on a verdict form. Mandel said he thought the verdict form “really needs [the court’s] input.”
On or about September 2, 2004, Manzarek and Krieger submitted a 25-page proposed general verdict form. At the end of each section for each cause of action, the form asked, “[If you have found liability], what amount, if any, do you award?” The parties apparently never agreed on the verdict form. Nor did the trial court give the jury any document asking them to make advisory findings.
D. The Jury’s Question and Verdicts, and the Post-Trial Proceedings
The jury began deliberating on September 2, 2004. On September 13, the jurors sent out several questions. Two of the questions apparently concerned the use of the word “harm” in the jury instructions. Mandel noted that the questions perhaps arose “because we ended up using a general verdict form and because the issue of equitable and non-equitable issues was hazy.” Mandel argued,
No party has included a copy of these questions in its appendix on appeal. I try to surmise what the questions were from the court’s discussion of them with counsel.
“I think the proper answer to question no. 4 is to say that harm includes any amounts by which the defendants have been unjustly enriched. . . . [¶] They’re wrestling with concepts of harm. While the disgorgement and the unjust enrichment are equitable remedies that the court will deal with, I think they need to understand for purposes of this that includes that. [¶] Then the court will deal with whatever the amount. They can put the amount in. The court will deal [with] whether it’s right or wrong. But it’s not a damage issue per se. But it is a harm issue. And the harm results from the failure to abide by the contractual obligation resulting in the unjust enrichment of the defendants.”
On behalf of Manzarek and Krieger, Briggs disagreed:
“Your Honor, this is clearly a breach of contract claim. That is for the province of the jury. The jury has been instructed pursuant to the instruction that they’re requesting which is the essential elements of a breach of contract. That is not an equitable remedy[;] rather [it] is one that the jury decides.”
The court stated,
“This is my suggestion: There’s so much that they’ve asked for. Why don’t we slowly look at this because I’d like to look at your original briefs when this whole issue of contract versus equitable. I think we can work this out. And interesting to see what they come up with.”
The court then permitted counsel to reopen argument. Mandel argued,
“Question No. 5 is a significant issue, and that is that the plaintiffs were harmed by the failure. . . . [¶] . . . Harm in the context of this lawsuit does not necessarily mean economically damaged. It doesn’t mean that we have to show that John lost money . . . as a result of either of the breaches that we’ve described. [¶] We have to show that John or the partnerships were harmed. We think that they were harmed because what’s happened is one form of harm is that the alleged wrongdoer has done something wrong and has benefitted at the expense of the person who is complaining or the partnership who is complaining. [¶] And so we have asked as you all well know that the defendants be held to be unjustly enriched. They have profited to the tune of however you do the calculation, [$]2 1/2 to $3 million. . . . As a consequence of not complying with the provisions of the partnership agreement, they have profited. And they ought not be entitled to keep their profits because that would be unjust and improper. . . . [¶] . . . [T]he defendants have profited to the tune of roughly $3 million. They ought not keep that in light of their own failure to adhere to the contract. And that’s the amount that should be awarded either in favor of John or in favor of the partnership as the court will determine at such time as the court considers everything that is going on and we deal with the other issues that are in this case.”
Briggs then addressed “[t]he question of damages, contract damages.” He said, “Mr. Mandel gets up and tells you that you can give damages for harm even though you haven’t really lost anything out of your pockets. Well, let’s think about that.” Briggs argued that Densmore didn’t play with the band and that he understood that he therefore would not be paid. Briggs discussed unjust enrichment and argued that Densmore had told Manzarek and Krieger that they could perform without him.
In rebuttal, Mandel argued that the issue was not “you don’t play, you don’t get paid”:
“By breaching the agreement, the defendants profited by undertaking conduct that they were not permitted to do. [¶] So should they be entitled to keep that money? No. The law says if you’re unjustly enriched, you have to – what we say disgorge, give up the profits that you’ve earned. That’s what the harm is. . . . [¶] . . . [¶] So I urge you to decide whatever you may decide. That’s your job, and we’ve invested in you to do that. But the issue of breach is different than the issue of harm. Harm is as we’ve discussed, the disgorgement, economic benefit.”
On September 27, 2004, the jury rendered its verdicts. On Densmore’s claims, the jury found in favor of Manzarek and Krieger on the causes of action for violation of the Lanham Act, common law unfair competition, violation of Business and Professions Code section 17200, and breach of oral partnership agreements. The jury found in Densmore’s favor on the causes of action for breach of the 1971 written agreement and breach of fiduciary duty. On both of those claims, the verdict form asked the jury, “[W]hat amount, if any do you award? $____.” On both causes of action, the jury wrote, “$0.” On the Estates’ claims, the jury found in Manzarek and Krieger’s favor on the causes of action for violation of the Lanham Act, common law trademark infringement, common law unfair competition, violation of Business and Professions Code section 17200, state trademark dilution, breach of contract, and breach of implied contract. The jury found in the Estates’ favor on the causes of action for violation of the post-mortem right of publicity and for breach of fiduciary duty. As it did on Densmore’s claims, the jury wrote “$0” in response to the question “[w]hat amount, if any, do you award?”
On Manzarek and Krieger’s cross-complaint, the jury found Densmore liable for breach of fiduciary duty, breach of the covenant of good faith and fair dealing, and promissory estoppel. The jury, again, answered “$0” when asked “[w]hat amount, if any, do you award?” The jury found Densmore not liable on the claim for violation of Business and Professions Code section 17200.
The court set a court trial “on the remaining equitable causes of action” and instructed counsel to submit proposed statements of decision as well as “position papers” on “(1) the jurors’ verdict, (2) what remains to be decided, and (3) the party’s position as to how the Court should rule.” Manzarek and Krieger filed a 39-page “Brief re: Court Trial” on October 18, 2004. Densmore and the Estates filed a 39-page “Position Paper” on October 20, 2004. Manzarek and Krieger filed a “Further Response to Plaintiffs’ Position Paper” on November 5, 2004. On November 9, 2005, counsel appeared and argued at great length. The court took the matter under submission. On February 8, 2005, the court issued an order calling for additional briefing on a number of issues. The court asked the parties “to state their positions, citing relevant case authority, as to each cause of action separately, in support of their position as to whether the specific action is a legal or equitable action.” The court also asked for supplemental briefing on whether Manzarek and Krieger were “entitled to a jury trial under the Lanham Act”; whether, if so, the court could “deviate [presumably, from the jury’s verdict] on related causes of action involving similar elements”; and whether -- given the jury’s rejection of the plaintiffs’ Lanham Act claim -- the court was “bound to rule in equity in a like manner as to the Cause of Action for False Advertising, in Violation of Business and Professions Code Section 17500?”
The court had not submitted to the jury the Estates’ claims for violation of Business and Professions Code section 17500, constructive trust, and accounting.
Manzarek and Krieger filed their supplemental brief on February 18, 2005. Densmore and the Estates apparently filed their supplemental brief the same day. Both sides filed reply briefs on February 25, 2005. The court issued a tentative statement of decision and conducted a further hearing on June 16, 2005. The court again took the matter under submission.
E. The Trial Court’s Statement of Decision
The court filed its final statement of decision on July 21, 2005. The court concluded that Densmore and the Estates’ Lanham Act claim was a legal claim; it therefore entered judgment for Manzarek and Krieger in accordance with the jury’s verdict. The court also entered judgment for Manzarek and Krieger -- consistent with the jury’s verdict -- on Densmore’s causes of action for common law unfair competition, violation of Business and Professions Code section 17200, and breach of the oral partnership agreements. On Densmore’s cause of action for breach of the 1971 written agreement, the court agreed with the jury’s verdict that Manzarek and Krieger had breached the agreement. But the court refused to accept the jury’s award of zero dollars. The court said that “damages” and “harm” were not the same thing. (The special verdict form did not use either word. It asked the jurors what “amount, if any,” they “award[ed]” to Densmore.) The court apparently concluded that it could find “harm” and order “[t]he equitable remedies of disgorgement of profits and a permanent injunction,” “notwithstanding the jury’s finding of no damages.” The court cited no authority for this conclusion. The court reached the same result on Densmore’s cause of action for breach of fiduciary duty.
On the Estates’ complaint, the court entered judgment for Manzarek and Krieger in accordance with the jury’s verdicts on the causes of action for violation of the Lanham Act, common law trademark infringement, common law unfair competition, violation of Business and Professions Code section 17200, state law trademark dilution, and breach of express and implied in fact contracts. On the Estates’ cause of action for breach of fiduciary duty, the court, again, ordered a permanent injunction and “disgorgement of profits” notwithstanding the jury’s verdict awarding zero dollars. On the cause of action for violation of the statutory post-mortem right of publicity, the court declined to follow the jury’s award of zero damages even though it found the claim to be a legal claim. The court awarded statutory damages of $750. On the cause of action for violation of Business and Professions Code section 17500 (which all parties agreed was equitable), the court found Manzarek and Krieger “liable for false advertising.” The court did not explain how it squared this conclusion with the jury’s verdict on the Lanham Act, unfair competition, dilution, and section 17200 claims – or whether it believed it was free to disregard the jury’s verdicts because the section 17500 cause of action was equitable. On the Estates’ remaining causes of action, the court ordered an accounting and disgorgement of the monies it deemed held by Manzarek and Krieger in constructive trust.
On Manzarek and Krieger’s cross-complaint, the court entered judgment in Densmore’s favor on all causes of action, notwithstanding the jury’s verdict. On the claims for breach of fiduciary duty and of the covenant of good faith, the court stated that “in the absence of any money damages, defendants have failed to demonstrate their entitlement to any relief.” Even though the jury found for Manzarek and Krieger on their claim against Densmore for promissory estoppel, the court treated that verdict as advisory and declined to follow it.
The trial court permanently enjoined Manzarek and Krieger from performing as The Doors, The Doors of the 21st Century, or under “any other name that includes the words The Doors.” After a later hearing on accounting issues, the court ordered Manzarek and Krieger to disgorge $3,282,274 in profits from their performances.
GOVERNING LAW
“ ‘The right to trial by jury is a basic and fundamental part of our system of jurisprudence. [Citation.] As such, it should be zealously guarded by the courts. . . .’ ” (Van de Kamp v. Bank of America (1988) 204 Cal.App.3d 819, 862-863 (Van de Kamp), quoting Byram v. Superior Court (1977) 74 Cal.App.3d 648, 654.) “ ‘In case of doubt, therefore, the issue should be resolved in favor of preserving a litigant’s right to trial by jury. [Citations.]’ [Citations.] Denial of the right to trial by jury is an act in excess of the court’s jurisdiction and is reversible error per se.” (Van de Kamp, supra,204 Cal.App.3d at p. 863.)
The Constitution guarantees a jury trial in actions triable by jury at common law. (Cal. Const., art. I, § 16; C&K Engineering Contractors v. Amber Steel Co. (1978) 23 Cal.3d 1, 8 (C&K Engineering).) “Generally speaking, this means that legal as distinguished from equitable actions are triable by jury.” (7 Witkin, Cal. Procedure (4th ed. 1997) Trial, § 94, p. 113; see also C&K Engineering, supra, 23 Cal.3d at p. 8 [“As a general proposition, ‘[T]he jury trial is a matter of right in a civil action at law, but not in equity’ ”].) Our Supreme Court has observed that the “distinction between [legal and equitable actions and] the two classes of remedies is more or less arbitrary and groundless.” (Philpott v. Superior Court (1934) 1 Cal.2d 512, 515.) “Since the distinctions between actions at law and proceedings in equity have been abolished, considerable difficulty has often been encountered in defining them. . . .” (DeGarmo v. Goldman (1942) 19 Cal.2d 755, 759.)
“In classifying an action as legal or equitable, the court will look to its substance, i.e., to the nature of the right involved and the remedy sought. The label or title of the complaint is never controlling.” (3 Witkin, Cal. Procedure (4th ed. 1996) Actions, § 117, p. 183.) The court must examine all of the pleadings – not just the complaint, but the answer and any cross-complaint as well – “to determine whether the case is at law or equity, or a combination of both.” (3 Witkin, supra, Actions, § 116, p. 182.) “ ‘ “[T]he court is not bound by the form of the action but rather by the nature of the rights involved and the facts of the particular case – the gist of the action. A jury trial must be granted where the gist of the action is legal, where the action is in reality cognizable at law.” ’ ” (C&K Engineering, supra, 23 Cal.3d at p. 9.) “The fact that trial by jury is jealously preserved as a matter of right dictates that the mere existence of a remedy in equity cannot operate to defeat a right to proceed at law. It is only where the issues to be tried are exclusively equitable in nature that a suitor is deprived of a right to a jury trial.” (Ripling v. Superior Court (1952) 112 Cal.App.2d 399, 408 [incompetent’s guardian sued alleged trustee/fiduciary for money had and received, and prayed for accounting, declaration of constructive trust, and money judgment; defendant was entitled to jury trial because plaintiff essentially elected to sue on contract-based debt].) “[E]quitable principles may be applied in an action at law without changing the character of the action.” (3 Witkin, supra, Actions, § 118, p. 185, citing Raedeke v. Gibraltar Sav. & Loan Assn. (1974) 10 Cal.3d 665, 671 (Raedeke).)
Lawsuits for breach of contract, money due under a contract or statute, injuries to person, reputation, or property, and quasi-contractual obligations and restitution are legal actions. (7 Witkin, supra, Trial, § 94, p. 114 [citing cases]; see also Civ. Proc. Code, § 592 [“In actions . . . for money claimed as due upon contract, or as damages for breach of contract, or for injuries, an issue of fact must be tried by a jury . . . .”].) Lawsuits for injunctions are equitable. (3 Witkin, supra, Actions, §§ 120-121, at pp. 186-188.) Where the action is hybrid, “raising both legal and equitable issues, a party is entitled to a jury trial of the severable legal issues.” (7 Wikin, supra, Trial, § 96, p. 115; see also Van de Kamp, supra, 204 Cal.App.3d at p. 863 [“Where a complaint states both legal and equitable causes of action, [litigants] are entitled to a jury trial on the legal causes of action”].) “[I]n a case involving both legal and equitable issues, the trial court may proceed to try the equitable issues first, without a jury (or . . . with an advisory jury)”; “if the court’s determination of those issues [also disposes] of the legal issues, nothing further remains to be tried by a jury.” (Raedeke, supra, 10 Cal.3d at p. 671.) If the legal and equitable issues are not severable, the right to a jury is determined under the “gist of the action” test. (See, e.g., Unilogic, Inc. v. Burroughs Corp. (1992) 10 Cal.App.4th 612, 622-623 [lawsuit for damages for conversion and misappropriation; defendant asserted equitable defense of unclean hands; court properly submitted entire case to jury because equitable defense was “intertwined” with legal claim and raised questions of fact and credibility properly submitted to jury].)
Where, however, the court tries the legal issues first to a jury, or refers factual issues to the jury, it cannot then disregard the jury’s findings or verdict. Hughes v. Dunlap (1891) 91 Cal. 385 (Hughes) states this rule and remains the leading case nearly 120 years after our Supreme Court decided it. In Hughes, the plaintiff alleged trespass by the defendant, and sued for damages as well as an injunction. The court impaneled a jury on the defendant’s motion and referred “certain issues of fact” to the jury. The jury returned findings and a verdict for the defendant, finding that the “plaintiff had suffered no damage.” The trial court “refuse[d] to adopt” the jury’s findings and verdict; it found that the plaintiff had been damaged by defendant’s acts. The California Supreme Court reversed. The court said, “An action to recover damages for past trespasses is as clearly a legal remedy as any that could be named; and it is an action in which a party cannot be deprived of a jury trial.” (Hughes, supra, 91 Cal. at p. 388.) The court therefore reversed the trial court’s judgment for the plaintiff. The court queried, “[D]oes the fact that [plaintiff] also prayed for an injunction take away from [defendant] the right to have the real issues of fact tried by a jury?” (Id. at p. 389.) The court continued: “[W]hen the asserted rights upon which any remedy [for plaintiff] must rest are legal rights, and cognizable in a court of law, must not those rights be determined according to the methods of a common-law court?” (Ibid.) (See also Farrell v. City of Ontario (1919) 39 Cal.App. 351, 354-355 [plaintiff alleged defendant diverted water onto his property; prayer for damages and injunction; trial court disregarded jury verdict for plaintiff and entered judgment for defendant; reversed; by joining “his two actions in one,” plaintiff “should not be held to have thereby forfeited his right to a jury trial of the legal issues”]; Robinson v. Puls (1946) 28 Cal.2d 664, 665-666 [complaint for declaratory relief, cancellation of notes, accounting or, in alternative, for money judgment; held error to deny jury trial]; Peterson v. Peterson (1946) 74 Cal.App.2d 312, 321 [complaint to cancel deed of trust, quiet title, recover reasonable rental value of property and for damages for fraud; held error to deny jury trial]; Pacific Western Oil Co. v. Bern Oil Co. (1939) 13 Cal.2d 60, 66 [injunction against removal of oil by drilling, and damages; denial of jury was error]; cf. Raedeke, supra, 10 Cal.3d 665, 671-675 [action to set aside foreclosure sale and for damages for conversion of personal property; plaintiffs ultimately presented their case to jury on theory that defendant lender had breached oral contract to postpone the sale; trial court treated as merely advisory the jury’s special finding that lender had agreed to postpone sale; court’s own finding to contrary and invalidation of monetary jury verdict for plaintiff reversed; while action to set aside foreclosure is equitable, suit to recover damages for breach of contract or fraud is action at law with jury trial right].)
DISCUSSION
The gist of the lawsuits brought here by Densmore and the Estates was twofold: (1) They claimed that Manzarek and Krieger breached various oral partnership agreements and the 1971 written contract by performing as The Doorswithout the unanimous consent of the partners; and (2) they claimed that Manzarek and Krieger engaged in unfair competition and trademark infringement by performing as The Doorswithout Densmore and Morrison. Both of these sets of claims are legal. (See generally Ceriale v. Superior Court (1996) 48 Cal.App.4th 1629, 1634-1635 [plaintiff who sued her former attorney was entitled to jury trial on claims for breach of contract, breach of fiduciary duty, and negligence; trial court erred in bifurcating case and trying some issues as equitable; “fact that equitable principles may come into play during the trial . . . does not abrogate the constitutional jury trial right”]; Collins Development Co. v. D.J. Plastering, Inc. (2000) 81 Cal.App.4th 771, 777 [trial court’s procedure of deciding allocation issue itself in lawsuit by indemnitee for contractual indemnity was “plainly defective”; because “claim was on a contract, [cross-defendant] was entitled to have the allocation portion of that claim tried by the jury”]; Dairy Queen v. Wood (1962) 369 U.S. 469 [action for injunction, accounting, and damages for breach of trademark licensing agreement triable by jury as matter of right].)
A. The Trial Court Erred in Awarding Monetary Relief to Densmore and the Estates After the Jury Determined That They Were Entitled to “$0”
Densmore’s causes of action for breach of the 1971 agreement and breach of fiduciary duty asserted legal rights. So did the Estates’ cause of action for breach of fiduciary duty. The trial court properly submitted those claims to the jury. The jury found in favor of Densmore and the Estates. The verdict form asked what amount, if any, they awarded. The jurors wrote “$0.” The trial court disregarded those $0 verdicts in awarding some $3.2 million to Densmore and the Estates. That ruling violated Manzarek and Krieger’s jury trial right.
The trial court never said whether it deemed the breach of fiduciary duty claims by Densmore and the Estates to be legal or equitable. It appears that the court did not instruct the jury on the elements of breach of fiduciary duty even though CACI instructions are available. (See, e.g., CACI Nos. 4100-4103.) Again, the “gist of the action” test applies. Here, the fiduciary duty that Densmore and the Estates alleged Manzarek and Krieger had breached arose from the partnership agreements. All parties and the court agreed that the jury was to determine whether the partnerships existed, who the partners were, and how the partners had decided to govern themselves. In light of the facts and legal theories alleged, as well as the prayer for monetary relief arising from the breach of the partnership agreements, the breach of fiduciary claims here were claims at law. (Compare Interactive Multimedia Artists, Inc. v. Superior Court (1998) 62 Cal.App.4th 1546 [dispute between shareholders that required application of “entire fairness” test under Delaware law was equitable even though plaintiff sought damages] with Ceriale v. Superior Court, supra, 48 Cal.App.4th 1629 [plaintiff was entitled to jury trial in action for legal malpractice asserting claims for breach of fiduciary duty, breach of contract, and negligence]; cf. Kangarlou v. Progressive Title Co. (2005) 128 Cal.App.4th 1174 [breach of fiduciary duty claim tried to jury].)
The court said the jury’s award of zero dollars did “not conclusively mean that the jury [had] found no harm.” The court said “damages” and “harm” are not the same thing, and it found that Densmore had suffered “harm.” Perhaps – although it did not say so -- the trial court reasoned as follows: (1) The jury instruction on Densmore’s breach of contract claim told the jurors that Densmore had to prove “harm” as one element of his cause of action. (2) The jury returned a verdict for Densmore on his breach of contract claim. (3) Therefore, the jury must have found that Densmore was “harmed.” But a conclusion that Densmore was “harmed” does not permit the court to disregard the jury’s award of zero damages on an indisputably legal claim for breach of contract. It is entirely permissible for the jury to find that Manzarek and Krieger breached the 1971 agreement but that Densmore is not entitled to any monetary award, whether consisting of a disgorgement of profits or any other calculation.
The majority says, “[T]he circumstance that the jury made no monetary award to any of the litigants would be certainly a startling occurrence in a trial of this length, and following jury deliberations that took nearly a month.” Whether “startling” or not, there is no reason to believe the jury did not mean exactly what it said. The jurors apparently viewed all the litigants as having behaved badly. Densmore was unable or unwilling to tour; but, rather than giving Manzarek and Krieger the go-ahead with his blessing, he blocked them from performing with other musicians as The Doors of the 21st Century. Manzarek and Krieger knew that the rule of the partnership was unanimity, but when Densmore acted unreasonably, they just went ahead in a “to-heck-with-him” manner. The Estates consist of people who have never touched a musical instrument or a microphone but want to take money from Morrison’s former band-mates who – in their mid-60s – are out working. The record shows that the jurors listened to more than two months of evidence, deliberated for several weeks, and reached verdicts consistent with the evidence. There is nothing puzzling about the conclusions they reached.
Densmore and the Estates argue that “the jury was advised that the trial court would later determine whether plaintiffs were entitled to recover defendants’ ill-gotten gains,” and that “[n]o instructions concerning money damages were tendered or submitted to the jury.” The record belies these assertions. As detailed above, Mandel told the jury in his closing arguments that Manzarek and Krieger should have to “give the money back”: “[T]hat’s what we ask you to do.” Forer asked the jurors to “make them pay.” Both Mandel and Forer talked about receipts, expenses, and profits calculations. The trial court gave the jury a series of instructions including one entitled “Trademark Damages – Defendants’ Profits” and another entitled “Wil[l]ful or Intentional Infringement Damages in the Absence of Profit”; it told the jurors that they could award “monetary relief” if Manzarek and Krieger willfully infringed the mark even if they “failed to profit.” When the jury sent out a question about the meaning of the word “harm” in the instructions, the court reopened argument: Mandel argued that Manzarek and Krieger had been unjustly enriched and had “profited to the tune of however you do the calculation, 2 1/2 to $3 million . . . .”
Neither the trial court nor the lawyers ever told the jury that it should decide only whether Manzarek and Krieger had breached the various agreements and infringed the mark, and that the court would decide how much money Densmore and the Estates should get. If that had been the understanding – or the court’s ruling over Manzarek and Krieger’s objection – there would have been no need for the jury to hear testimony about Manzarek and Krieger’s receipts and expenses. There would have been no need for counsel to argue to the jury about how to calculate profits. There would have been no need for the court to instruct the jury on permissible and impermissible deductions, apportionment of gross profits, and the like.
Densmore and the Estates called David Kirby, a talent agent who booked live performances for The Doors of the 21st Century, as a trial witness. Mandel went through a series of questions with Kirby about how much the band had received for performances in Europe, Asia, and elsewhere. The jury also heard extensive testimony from Alan Goldman and Thomas Vitorino, who essentially served as managers for the band, about “the numbers.” Counsel questioned Vitorino about the production grosses and nets from Manzarek and Krieger’s performances. Vitorino testified, for example, that he thought the band had gross receipts of about eight million dollars. Indeed, some of this questioning gave rise to a heated dispute between counsel: Manzarek and Krieger’s lawyer argued that the court should not permit counsel for Densmore and the Estates to ask Goldman about this financial information because it was a back-door attempt to inquire into matters bearing on punitive damages, which the court had bifurcated for trial. Mandel (Densmore’s attorney) and Forer (the Estates’ attorney) told the trial court that they wanted, and were entitled, to ask the witness what Manzarek and Krieger “gained” from their concert tour using the name The Doors. Mandel argued, “If we’re seeking and entitled to disgorgement and restitution, we’re entitled to know the amount of money that is involved. [¶] . . . [¶] We’re trying to get to a place of gross numbers. And presumably . . . I’ve been told, that the defendants then are going to try to knock down the gross numbers by showing their expenses of doing business.” If the court and not the jury were going to decide whether Densmore and the Estates should recover money and, if so, how much, these many hours of testimony before the jury would have been wholly unnecessary.
Nor does any suggestion that the jury may have been instructed on trademark money damages but not on contract money damages make sense. Densmore and the Estates do not cite to a single page of the nearly 20,000-page record in which the jurors ever were told that they should calculate profits on the trademark and unfair competition claims, but that the court would calculate profits on the breach of contract and fiduciary duty claims.
Densmore and the Estates seize on a single statement by Mandel in his supplemental closing argument after the jury asked about “harm.” Mandel told the jurors that Manzarek and Krieger had “profited to the tune of roughly $3 million,” that they should not be allowed to keep it, and that “that’s the amount that should be awarded either in favor of John or in favor of the partnership as the court will determine at such time as the court considers everything that is going on and we deal with the other issues that are in this case.” (Italics added.) This argument appears to refer to whether Densmore as an individual or Densmore on behalf of various partnerships would receive any award. And even if, by this comment, Mandel meant to say that the jurors were not to consider any monetary award, his statement was inconsistent with the hours of trial testimony and argument, as well as the jury instructions, in which Densmore and the Estates asked the jury to award lost profits. On the question of what the jurors were asked to do, what governs is not counsel’s peripheral remark during argument but the jury instructions and the verdict form. A passing comment by a lawyer in argument about which entity will get the money cannot trump the instructions and verdict form. The instructions and verdict form come from the court. They govern. Densmore and the Estates never objected to the verdict form. That form repeatedly asked the jurors what amount, if any, they awarded. It included a dollar sign with a blank space next to it for each cause of action. Densmore and the Estates do not like the zeros. But that is what the jury decided, and that is what should govern.
Mandel also made an earlier comment during the court’s discussion with counsel about the jury question suggesting that Densmore and the Estates were proposing that whatever figure the jury put in the “$___” blank would be advisory only:
“While the disgorgement and the unjust enrichment are equitable remedies that the court will deal with, I think [the jurors] need to understand for purposes of this that includes that. [¶] Then the court will deal with whatever the amount. They can put the amount in. The court will deal [with] whether it’s right or wrong.”
But this is not how our process works. Manzarek and Krieger were constitutionally entitled to a jury trial on Densmore’s breach of contract claim. Densmore and the Estates cannot submit the matter to the jury, wait to see if they like the jury’s number, and then ask the court to disregard the verdict and to substitute another number if the jury’s vote is too low. In the same argument, Mandel said that the harm to Densmore “results from the failure to abide by the contractual obligation resulting in the unjust enrichment of the defendants.” This is a legal claim, and the court cannot ignore the jury’s award of zero dollars.
The members of our community who diligently served as trial jurors in this case for nearly fourteen weeks would be startled to learn that their months of work counted for nothing. Densmore and the Estates sued and went to trial. A month into the jury trial, they raised for the first time their proposal that the court rather than the jury decide most of the case. Whether this conduct was inadvertent or by design, it left the trial court in a terrible spot. Sorting out the legal versus the equitable claims and arranging for advisory findings in a jury trial is an arduous task even when planned well in advance of jury selection. Here – for months after the trial ended – the parties still were fighting tooth and toenail about which claims were legal and which were equitable, which were for the court and which were for the jury. Regardless of who bears responsibility for this haphazard way of proceeding, the required result is the same: Having submitted the legal issues of breach of contract and breach of fiduciary duty to the jury, the trial court was obligated to give the jury’s verdict the respect it deserves. The jurors’ verdict was binding on the court and the parties.
B. The Trial Court Properly Issued a Permanent Injunction
The jury found that Manzarek and Krieger breached the 1971 contract as well as fiduciary duties to Densmore and the Estates. The trial court permanently enjoined Manzarek and Krieger from performing asThe Doors or The Doors of the 21st Century. This was within the trial court’s power.
Manzarek and Krieger contend that, because the jury found in their favor on their cross-claim for promissory estoppel, Densmore cannot prevail on his breach of contract claim. Promissory estoppel is an equitable claim to be tried by the court. (C&K Engineering Contractors, supra, 23 Cal.3d at pp. 6-12.) Because it is purely an equitable claim, the court may disregard the advisory jury’s finding. (Cf. Hartman v. Burford (1966) 242 Cal.App.2d 268 [judge could make own findings of fact notwithstanding advisory jury verdict in purely equitable action for quasi-specific performance seeking decree that defendants held part of decedent’s estate for plaintiff’s benefit].) The trial court did that here. Manzarek and Krieger also argue that they were entitled to a jury trial on their defense of estoppel to the breach of contract claim in Densmore’s complaint. They had that jury trial: the jury apparently rejected the defense in finding for Densmore on his cause of action for breach of contract.
Injunction is a typical form of equitable relief. (3 Witkin, supra, Actions, § 121, p. 187.) While the usual remedy for breach of contract is damages, “injunctions are occasionally granted in contract actions.” (3 Witkin, supra, Actions, § 120, p. 187.) “[A] final injunction may be granted to prevent the breach of an obligation existing in favor of the applicant . . . [w]here the restraint is necessary to prevent a multiplicity of judicial proceedings.” (Civ. Code, § 3422, subd. 3.) If Manzarek and Krieger continued to tour as some variation of The Doors, Densmore and the Estates would have to file lawsuit after lawsuit to recover their profits. In these circumstances, injunctive relief is available. (Cf. Tamarind Lithography Workshop, Inc. v. Sanders (1983) 143 Cal.App.3d 571, 575 [breach of agreement to give writer-director of film screen credits; damages properly awarded for past damages, and specific performance granted to prevent future harm from exhibition of film without credits].)
C. Densmore and the Estates Lack Standing To Sue Under California Business and Professions Code Section 17500
The jury found against Densmore and the Estates on all of their causes of action for trademark infringement and unfair competition. The trial court, however, found for the Estates on their false advertising claim under Business and Professions Code section 17500. The court gave these reasons:
“By engaging in advertising which prominently displayed the logo of The Doors, in The Doors’ well-known type font, and minimizing in a different font the words “21st Century” or “of the 21st Century,” coupled with the use of the outtake photograph from the Strange Days album cover, and further permitting the dissemination of radio and television ads prepared by Bill Young Productions that identified the band as The Doors and the tour as the 21st Century Live tour, the defendants have engaged in false advertising.”
The court did not discuss the jury’s verdicts to the contrary or make any attempt to square its findings with those verdicts. As noted, the jury found in favor of Manzarek and Krieger on Densmore’s and the Estates’ claims for violation of the Lanham Act, common law trademark infringement, trademark dilution, common law unfair competition, and unfair competition in violation of Business and Professions Code section 17200. Any violation of California’s false advertising law necessarily violates California’s unfair competition law. (Arizona Cartridge v. Lexmark Intern., Inc. (9th Cir. 2005) 421 F.3d 981, 986.) The trial court instructed the jury that it could find that Manzarek and Krieger violated Business and Professions Code section 17200 if they (among other things) “engaged in unfair, deceptive, untrue or misleading advertising.” The jury obviously found that Manzarek and Krieger had not done so.
Nor did the court explain whether it found Manzarek’s and Krieger’s “advertising” to be false or, instead, true but misleading. (See generally Laster v. T-Mobile USA (S.D. Cal. 2005) 407 F.Supp.2d 1181 [California’s false advertising law prohibits not only advertising that is false but also advertising that, although literally true, is either actually misleading or has capacity, likelihood, or tendency to deceive or confuse public].) The standard of “likelihood or tendency to deceive or confuse the public” requires a probability that a significant portion of the general consuming public or of targeted consumers, acting reasonably in the circumstances, could be misled. (People ex rel. Dept. of Motor Vehicles v. Cars 4 Causes (2006) 139 Cal.App.4th 1006.) (Cf. Special Instruction No. 18.15: trial court instructed jury that, “[i]n order to find for [Densmore and the Estates] in their action for trademark infringement, you must consider whether the defendants’ use of the names The Doors or The Doors of the 21st Century is likely to cause confusion about the source of the plaintiffs’ goods and services or of the defendants’ goods or services.”) What was false or misleading, exactly? Surely no one buying a ticket in the 21st century to see The Doorsin concert would expect to see Jim Morrison perform. He has been dead for some 37 years. Indeed, Morrison vies with Janis Joplin, Jimi Hendrix, and John Lennon for the title of world’s most famous rock musician to have died young.
The parties agree that a lawsuit under Business and Professions Code section 17500 is an equitable one. The trial court therefore was free to decide the claim, even if its findings conflicted with the jury’s verdicts on similar causes of action. (See Hughes v. Dunlap, supra, 91 Cal. at p. 388 [“under our system a legal and equitable remedy may be sought in the same action; but each remedy must be governed by the same law that would apply to it if the other remedy had not also been asked for”].) But the Estate’s statutory false advertising claim fails for a different reason. Private individuals can sue under California’s Unfair Competition Law (Bus. & Prof. Code, § 17200 et seq.) only if they have “suffered in injury in fact and [have] lost money or property as a result of” the unfair competition. (Bus. & Prof. Code, §§ 17204 [unfair competition in general], 17535 [false advertising in particular], as amended by Prop. 64, §§ 2, 5, & 6 (Nov. 2, 2004).) Here, the jury awarded zero dollars to the Estates on their claims. Nor did the Estates prove that they lost money or property from Manzarek’s and Krieger’s ads for their concerts. Mandel told the court before the trial started, and he told the jurors in his opening, that the plaintiffs were not claiming any harm to the catalogue.
D. The Trial Court Erred in Invalidating the Jury’s Verdicts for Manzarek and Krieger on their Cross-Complaint
As noted, the jury found for Manzarek and Krieger on their cross-claims against Densmore for breach of fiduciary duty and breach of the duty of good faith and fair dealing. These were legal claims. The trial court, however, entered judgment for Densmore. The court stated that the jury had “awarded no damages” to Manzarek and Krieger and that, “in the absence of any money damages, [Manzarek and Krieger] [had] failed to demonstrate their entitlement to any relief. . . .”
The trial court applied a different rule to the cross-complaint than it applied to the complaints. On Densmore and the Estate’s claims for breach of contract and fiduciary duty, the court ruled that “zero monetary award” did not mean “no harm.” It apparently concluded that the jury must have found harm in returning verdicts for Densmore and the Estates, and so the court entered judgment for Densmore and the Estates. On Manzarek and Krieger’s cross-claims, however, the court said that a no-damages award by the jury meant that Manzarek and Krieger had not proved breach of fiduciary duty or of the covenant of good faith. The trial court did not give any reason for its application of these contrary rules. The jury instruction that the court gave the jurors on Manzarek and Krieger’s cause of action for breach of the covenant of good faith told them that Manzarek and Krieger had to show “harm”; there was no mention of “damages.” Either “harm” can exist without “damages” or it can’t. Either a plaintiff who has no damages but who has been “harmed” can recover for breach of contract or of the covenant of good faith or he can’t. What’s good for the goose is good for the gander. If the court could find an implicit jury finding of “harm” in the jurors’ verdict for Densmore on his breach of contract claim, then it should have found an implicit jury finding of “harm” in the jurors’ verdict for Manzarek and Krieger on their cross-claims.
CONCLUSION
The denial of a trial by jury to one constitutionally entitled to it constitutes a miscarriage of justice and requires a reversal of the judgment. (Collins Development Co. v. D. J. Plastering, Inc., supra, 81 Cal.App.4th at p. 778.) Having listened to all the evidence and seen all the exhibits and heard all the jury instructions and counsel’s arguments, the jury concluded that the parties had established certain legal claims but that the right “amount” to “award” to each was zero. The trial court, and this court, should honor that verdict. Respect for the role and power of the jury that labored for months on this case and rendered verdicts consistent with the facts and the law requires that the money judgments in favor of Densmore and the Estates be reversed.