## Facts

- Zomba Recording, LLC (successor to Zomba Recording Corporation) operated the Verity Records label and contracted for the exclusive recording services of gospel artist Anthony C. Williams II (professionally known as “Tonéx”) through his company, Mo’ Soule Steppyn Records, Inc. (MSSR).
- The parties’ dispute centered on an agreement dated as of November 1, 2000, reserving Williams’s exclusive recording services to Zomba.
- Zomba alleged defendants entered a competing recording agreement with nonparty Nureau Ink, LLC and marketed and sold albums embodying Williams’s performances through the Internet and other channels.
- Zomba also alleged conduct damaging to its goodwill, including a public campaign and merchandise criticizing Zomba.
- Williams resided in California and created most music there; Zomba was headquartered in New York and conducted promotion, marketing, manufacturing, distribution, and sales from New York.
- Williams argued California law governed based on California Labor Code § 2855 (the “seven-year rule”) and contended the agreement was unenforceable or had expired; Zomba relied on the contract’s New York choice-of-law clause.

## Issues

1. Whether the contract’s New York choice-of-law clause was enforceable or displaced by California public policy, including California Labor Code § 2855.
2. Whether Zomba met the requirements for a preliminary injunction enforcing exclusivity and restraining defendants’ competing exploitation of Williams’s recordings.
3. Whether Zomba should be permitted to amend the complaint to add an injunctive-relief claim and join Nureau as a defendant.

## Decision

- The court granted partial summary judgment declaring the contract governed by New York law under the agreement’s choice-of-law clause.
- The court granted a preliminary injunction restraining defendants from producing, manufacturing, distributing, releasing, marketing, advertising, or offering for sale sound recordings embodying Williams’s performances except pursuant to Zomba’s rights.
- The court granted leave to amend the complaint to add an injunctive-relief cause of action and to add Nureau Ink, LLC as a defendant.

## Legal Principles

- New York courts generally enforce contractual choice-of-law clauses when the chosen law bears a reasonable relationship to the transaction and enforcement does not violate a fundamental public policy of a jurisdiction with a materially greater interest.
- A preliminary injunction requires: (1) likelihood of success on the merits, (2) irreparable harm absent injunctive relief, and (3) a balance of equities favoring the movant.
- Exclusive personal-services agreements in the recording industry may support findings of irreparable harm because the services are unique and interference with marketing strategy, release timing, and goodwill is not readily measured in money damages.
- Leave to amend under CPLR 3025(b) is freely granted absent undue prejudice or surprise; joinder is appropriate when the proposed defendant is closely connected to the alleged wrongful conduct.

## Conclusion

The court enforced the parties’ New York choice-of-law clause despite the artist’s effort to invoke California’s seven-year limitation, issued a preliminary injunction to protect Zomba’s exclusive recording rights from competing releases, and permitted amendment and joinder to include the alleged competing label involved in the disputed recordings.


Zomba Recording, L.L.C. v. Williams, 15 Misc. 3d 1118(A), 839 N.Y.S.2d 438 (Sup. Ct. N.Y. Cnty. 2007)