Whether Defendants were authorized to utilize new technology to redistribute and license Plaintiffs� music, where Plaintiffs� contractually transferred all ownership rights of their master recordings to Defendants.

Yes. Because Plaintiffs did not explicitly reserve certain ownership rights in the contract, and because the contract is complete and unambiguous on its face, the plain language of the contract will govern.

In 1963, Plaintiffs formed a singing group (øThe RonettesÓ) and signed a five year, two page contract with Defendants, in which Defendants obtained ownership rights to the group�s master recordings, including, øthe right to make phonograph records, tape recordings or other reproductions of the performances embodied in such recordings by any method now or hereafter known.Ó Although the contract had a royalty schedule, Plaintiffs never received any royalty payments from Defendants. The Ronettes disbanded in 1967, and Defendants subsequently went out of business. As time passed and new recording technologies developed, Defendants sold compilation records and licensed several of the group�s recordings to third parties for ødomestic redistributionÓ and for movies and television (øsynchronizationÓ), without making any royalty payments to Plaintiffs.

Plaintiffs filed a breach of contract action in 1987, alleging that the contract did not give Defendants the right to use the group�s recordings for synchronization or domestic redistribution and that they were entitled to royalty payments for the sale of the compilation records. The Supreme Court awarded Plaintiffs $3 million in damages for licensing income and royalty payments on album sales. The Appellate Division affirmed on the grounds that the contract did not øspecificallyÓ give Defendant the right to license the recordings for synchronization and redistribution. The Court of Appeals modified the order and remanded the case for an assessment of damages on the royalty payments from album sales.

The Court concluded that although the contract was silent as to the issue of new recording technology and third party licensing, it was complete on its face and unambiguous. The Court noted that where a contract is unambiguous, the Court will only look to the plain language of the contract and will not consider extrinsic evidence of the parties� intent. SeeR/S Assocs. v. New York Job Dev. Auth., 98 N.Y.2d 29, 32 (2002); W.W.W. Assocs. v. Giancontieri, 77 N.Y.2d 157, 162 (1990). The Court also cited the well-established common law principle that when a grantor transfers unconditional ownership rights, any reservation of rights must be explicitly stated. ø[T]he unconditional transfer of ownership rights to a work of art includes the right to use the work in any manner.Ó Pushman v. New York Graphic Soc. 287 N.Y. 302, 308 (1942). Given that the plain language of the contract stated that Plaintiffs granted all ownership rights of their master recordings to Defendants, including ørecordings by any method now or hereafter known,Ó the Court concluded that Defendants did not breach the contract by licensing the recordings for synchronization and redistribution and that Plaintiffs were not entitled to damages for the income from such licenses. Because Defendants conceded that the contract�s royalty schedule would include royalty payments for record sales from redistribution and compilation albums, the Court remanded the case to assess royalties due to Plaintiffs based on the original royalty schedule, as opposed to the current industry standard.