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Kaffaga v. Estate of Steinbeck: Copyright and Damages in the Latest Litigation Round over John Steinbeck’s Works

Copyright Reports

Kaffaga v. Estate of Thomas Steinbeck, No. 18-55336, (9th Cir. Sept. 9, 2019).

On September 9, 2019, the United States Court of Appeals for the Ninth Circuit reviewed a decision regarding copyrights over John Steinbeck’s works. The court affirmed a 2018 verdict awarding plaintiff Waverly Scott Kaffaga—executrix of the Estate of Elaine Steinbeck (the author’s wife)—$5.25 million in compensatory damages, but vacated and remanded the punitive damages claims against defendant Gail Knight Steinbeck (the wife of the author’s late son by an earlier marriage, Thomas Steinbeck).

John Steinbeck’s heirs have been engaged in a dispute spanning several decades over the right to control and profit from his works. Earlier conflicts resulted in a settlement agreement signed in 1983 (“1983 Settlement Agreement”), under which Elaine Steinbeck retained control over the works, while John Steinbeck IV and Thomas Steinbeck received a share of royalties.

The 1983 Settlement Agreement was not the end of the family’s legal disputes. In the latest of a series of court actions, Kaffaga (Elaine Steinbeck’s daughter) sued Knight Steinbeck, the Estate of Thomas Steinbeck, and The Palladin Group, Inc. (owned by Knight Steinbeck) for breach of the 1983 Settlement Agreement, slander of title, and tortious interference with economic advantage.

One of the claim’s main assertions was that the defendants prevented the remake of film adaptations of Steinbeck’s most famous works, including “The Grapes of Wrath” and “East of Eden.” Kaffaga contended that several negotiations she held with Hollywood studios fell through due to interference by defendants who claim to represent rights over John Steinbeck’s works in spite of prior litigation determining they had no such rights.

In 2018, a federal jury in California awarded Kaffaga $5.25 million for compensatory damages and $7.9 million for punitive damages. The punitive damages included $5.925 million against Knight Steinbeck, personally.

On appeal before the Ninth Circuit, the defendants raised—and were defeated on—several issues related to the 1983 settlement agreement and evidentiary matters. In connection with the damage awards, defendants argued that the compensatory damages were “duplicative and speculative” and that the punitive damages against Knight Steinbeck were not supported by “meaningful evidence” of her financial situation.

The Ninth Circuit affirmed the jury’s decision in connection with compensatory damages on all causes of action. It dismissed defendants’ argument that there was double recovery based on the same harm as a result of the tortious interference and breach of contract causes of action, stating that a suspicion of double recovery was insufficient to reverse the verdict and that the record contained evidence supporting each individual cause of action. Further, the court held that the compensatory damages awarded by the jury were not speculative, but rather, were reasonable estimates grounded on testimonies and documentary evidence.

However, the court vacated the award for punitive damages against Knight Steinbeck. Under California law, punitive damages require “fraud, or malice.” Cal. Civil Code § 3294(a). The court held that there was more than enough evidence on record of the defendant’s malice. Nonetheless, the court ultimately vacated the punitive damage award. It referred to the “passion and prejudice” standard existing under California law, which burdens the plaintiff with placing on the record “meaningful evidence of the defendant’s condition” in order to demonstrate ability to pay, citing Adams v. Murakami, 813 P.2d 1348, 1350 (Cal. 1991) (en banc). The court found that Kaffaga had failed to meet this burden, since the information on record did not allow it to come to an approximation of Knight Steinbeck’s net worth which could be compared against the award to determine whether the sum was excessive. The court vacated the $5.925 million award against Knight Steinbeck individually, and remanded the case to the lower court with instructions to dismiss this claim.

The court’s unanimous opinion, written by Judge Tallman, expresses both appreciation for literature (the decision is arranged in “chapters” and contains multiple literary references) and exasperation with the unending dispute in interests over Steinbeck’s works. “This has to end. We cannot say it any clearer,” reads the opinion.