## Facts

- Alberto Vargas, a commercial artist, entered an employment agreement with Esquire in 1940 to produce illustrations for the magazine and calendars for fixed compensation plus certain percentages.
- The parties agreed to use the signature “Varga” (instead of “Vargas”) on the published images; the illustrations became known as “Varga Girls.”
- In 1943, the parties executed a new contract superseding the prior agreement, under which Vargas sold, assigned, and transferred to Esquire all right, title, and interest in the original artwork and the names “Varga” and “Varga Girl,” and gave Esquire the right to copyright and use them in any manner and at any time.
- Through early 1946, Esquire continued to publish the images with Vargas’s name; beginning around March 1946, Esquire published them without his name or attribution and used other designations.
- Vargas sued seeking an injunction requiring attribution, cancellation of the 1943 contract, and damages, alleging an implied right to credit (often framed as “moral rights”) and unfair competition/misrepresentation.
- The district court dismissed the complaint for failure to state a claim, and Vargas appealed.

## Issues

1. Whether an implied contractual duty required Esquire to publish the artwork with Vargas’s name notwithstanding a written assignment transferring all rights in the artwork and related names.
2. Whether Vargas retained any property or copyright interest in the artwork or the “Varga” names sufficient to control Esquire’s later publications.
3. Whether U.S. law recognized an enforceable “moral right” of attribution in these circumstances absent statute or express agreement.
4. Whether Esquire’s publication without attribution and use of alternative labels stated a claim for unfair competition or misrepresentation.

## Decision

- The Seventh Circuit affirmed dismissal for failure to state a claim.
- The 1943 contract unambiguously transferred all of Vargas’s rights in the artwork and the “Varga” and “Varga Girl” names to Esquire, leaving no basis to imply an attribution requirement.
- Because Vargas retained no property interest after the transfer, he lacked a legal basis to enjoin Esquire’s use or recover damages for the manner of publication.
- The court declined to recognize an independent moral right of attribution under applicable U.S. law in the face of a comprehensive assignment.
- The unfair competition and misrepresentation theories failed because Esquire was exercising rights it lawfully acquired, including the right to publish with or without Vargas’s name and to use other designations.

## Legal Principles

- When a written contract unambiguously assigns “all right, title and interest” in artwork and associated names, courts generally will not imply additional obligations that conflict with the express grant.
- An assignor who transfers all rights in the work and related designations ordinarily retains no residual property interest enabling control over later exploitation by the assignee.
- Absent statute or express contractual reservation, a claim to continued attribution as a standalone “moral right” is not enforceable in this setting.
- Unfair competition does not arise merely from an assignee’s exploitation or rebranding of property rights it purchased from the claimant.

## Conclusion

The court held that Vargas’s comprehensive assignment of the artwork and the “Varga” names to Esquire foreclosed claims for implied attribution, residual property rights, moral-rights-based relief, and unfair competition arising from Esquire’s later decision to publish the images without crediting him.


Vargas v. Esquire, Inc., 164 F.2d 522 (7th Cir. 1947)