978 F.2d 1093 (9th Cir. 1992)
Tom Waits is a professional singer, songwriter, and actor who began his career in the early 1970s.1 Since the early 1970s, when his professional singing career began, Waits has recorded more than seventeen albums and has toured extensively, playing to sold-out audiences throughout the United States, Canada, Europe, Japan, and Australia.2 In 1987, Waits received Rolling Stone magazine's Critic's Award for Best Live Performance, chosen over other noted performers such as Bruce Springsteen, U2, David Bowie, and Madonna.3 Waits has a raspy, gravelly singing voice, described by one fan as "like how you'd sound if you drank a quart of bourbon, smoked a pack of cigarettes and swallowed a pack of razor blades.... Late at night. After not sleeping for three days."4
Tom Waits does not, however, do commercials.5 He has maintained this policy consistently during the past ten years, rejecting numerous lucrative offers to endorse major products.6 Moreover, Waits' policy is a public one: in magazine, radio, and newspaper interviews he has expressed his philosophy that musical artists should not do commercials because it detracts from their artistic integrity.7
In 1988, Frito-Lay, Inc. and its advertising agency Tracy-Locke, Inc. developed a radio commercial for a new product, SalsaRio Doritos.8 The commercial concept drew inspiration from Waits' 1976 song "Step Right Up," a parody of advertising.9 The initial efforts of the ad agency's creative team, using a respected professional singer with a deep bluesy voice, met with disapproval from executives at both Tracy-Locke and Frito-Lay.10 Tracy-Locke then auditioned several other singers who could sing in a gravelly style.11 Stephen Carter was among those who auditioned.12 Over ten years of performing Waits songs as part of his band's repertoire, he had consciously perfected an imitation of Waits' voice.13
During the production process, Tracy-Locke personnel expressed concerns about the legal implications of Carter's skill in imitating Waits.14 On the day the commercial was due for release to radio stations across the country, Grossman had a ten-minute long-distance telephone consultation with Tracy-Locke's attorney, asking him whether there would be legal problems with a commercial that sought to capture the same feeling as Waits' music.15 Grossman then presented both the Carter tape and the alternate version to Frito-Lay, noting the legal risks involved in the Carter version.16 He recommended the Carter version, however, and noted that Tracy-Locke would indemnify Frito-Lay in the event of a lawsuit.17 Frito-Lay chose the Carter version.18
The commercial was broadcast in September and October 1988 on over 250 radio stations located in 61 markets nationwide, including Los Angeles, San Francisco, and Chicago.19 Waits heard it during his appearance on a Los Angeles radio program, and was shocked.20 He realized "immediately that whoever was going to hear this and obviously identify the voice would also identify that [Tom Waits] in fact had agreed to do a commercial for Doritos."21
In November 1988, Waits sued Tracy-Locke and Frito-Lay, alleging claims of misappropriation under California law and false endorsement under the Lanham Act.22 The case was tried before a jury in April and May 1990.23 The jury found in Waits' favor, awarding him $375,000 compensatory damages and $2 million punitive damages for voice misappropriation, and $100,000 damages for violation of the Lanham Act.24 The court awarded Waits attorneys' fees under the Lanham Act.25 Defendants Frito-Lay, Inc., and Tracy-Locke, Inc., appeal a jury verdict and award of $2.6 million in compensatory damages, punitive damages, and attorney's fees, in favor of singer Tom Waits.26
Whether the tort of voice misappropriation recognized in Midler v. Ford Motor Co. remains viable under California law following the Supreme Court's decision in Bonito Boats, Inc. v. Thunder Craft Boats, Inc. and is not preempted by the federal Copyright Act?27
A state right-of-publicity claim for deliberate imitation of a widely known distinctive voice survives Bonito Boats preemption analysis.28 It also survives Copyright Act preemption under 17 U.S.C. § 301 because the Supreme Court has rejected sweeping preemption of state protections for unpatented designs and because a voice is not a fixed work of authorship.29
Yes. The court held that Bonito Boats itself cautions against reading Sears and Compco for a broad pre-emptive principle and reaffirmed the authority of states to protect entertainers' right of publicity as in Zacchini.30 Applying the rule to the established facts, Frito-Lay and Tracy-Locke broadcast a commercial featuring Stephen Carter's imitation of Tom Waits' raspy voice after consulting counsel about Midler risks yet proceeding anyway, so the Midler tort remains fully viable and supports Waits' claim.31
The voice-misappropriation tort remains viable under California law and was properly asserted.32
Whether the district court's jury instructions on the elements of voice misappropriation, including the distinctions between voice and style, the definition of distinctiveness, and the meaning of widely known, were proper?33
Jury instructions on voice misappropriation are proper when they track the Midler elements of deliberate imitation of a distinctive and widely known voice.34 They distinguish voice from unprotected style, define distinctiveness by reference to identifiability, and define widely known by reference to a large number of people across a geographic area.35
Yes. The district court instructed the jury to decide whether Waits' voice is distinctive, widely known, and deliberately imitated, added an instruction that style imitation alone is insufficient, and defined distinctive as distinguishable from other singers by particular qualities.36 Applying the rule to the established facts, the jury heard Waits' recordings, Carter's performance, and testimony that Carter had perfected a Waits imitation over ten years, so the instructions correctly guided the jury to find liability only for voice appropriation.37
The jury instructions on voice misappropriation were proper.38
Whether damages for injury to peace, happiness, feelings, goodwill, professional standing, and future publicity value are recoverable in a voice misappropriation action and were supported by the evidence?39
Yes. California law permits recovery for shame, humiliation, and anger caused by tortious conduct, and reputational damages have been awarded in right-of-publicity cases.42 Applying the rule to the established facts, Waits testified he was shocked and embarrassed, had to call friends to disclaim the commercial, and maintained a public stance against endorsements; expert testimony showed his future fees could drop by $50,000 to $150,000, supporting the $200,000 mental-distress and $75,000 reputational awards.43
Damages for injury to peace, happiness, feelings, goodwill, professional standing, and future publicity value are recoverable and were supported by the evidence.44
Whether punitive damages are available in a voice misappropriation action and were supported by clear and convincing evidence of malice?45
Punitive damages are available under California Civil Code § 3294 when the defendant acts with oppression, fraud, or malice defined as despicable conduct carried on with willful and conscious disregard of the plaintiff's rights.46 The right of a well-known singer to control commercial use of a distinctive voice was clearly established by Midler.47
Yes. The court held that Midler had clearly established the right three months before the conduct, Tracy-Locke personnel were familiar with the decision, warned Frito-Lay of legal risks, yet recommended the Carter version and offered indemnification.48 Applying the rule to the established facts, the jury could find a high probability that the defendants knowingly impugned Waits' integrity by broadcasting the imitation despite awareness of his policy and legal rights, supporting the $2 million punitive award.49
Punitive damages are available and were supported by clear and convincing evidence.50
Whether a celebrity plaintiff has standing to assert a false endorsement claim under section 43(a) of the Lanham Act when not in direct competition with the defendants?51
Yes. The court reconciled Smith and Halicki by holding that false-association claims, including false endorsement, do not require actual competition; the plaintiff need only possess a reasonable commercial interest protected by the Lanham Act.54 Applying the rule to the established facts, Waits possessed a commercial interest in controlling use of his unique voice as an endorser, and the defendants' imitation created a likelihood of consumer confusion as to his association with SalsaRio Doritos, conferring standing.55
A celebrity plaintiff has standing to assert a false-endorsement claim under section 43(a) even without direct competition.56
Whether the evidence was sufficient to support the jury's finding of a likelihood of consumer confusion on the false endorsement claim?57
Yes. The court held that the jury could consider the distinctiveness of Waits' voice, the defendants' intent to imitate, and evidence of actual confusion.60 Applying the rule to the established facts, the jury heard Waits' recordings and the commercial, learned the spot targeted males aged 18-35 who listened to Waits' music, and received testimony from multiple witnesses who believed Waits sang the endorsement, supporting the finding of likely confusion.61
The evidence was sufficient to support the jury's finding of likelihood of consumer confusion.62
Whether the damages awarded on the Lanham Act claim were duplicative of those awarded on the voice misappropriation claim?63
Damages awarded under the Lanham Act for the fair market value of a celebrity's services are duplicative when the same measure of damages has already been awarded on a state voice-misappropriation claim arising from the identical conduct.64
Yes. The court instructed the jury that it could award the fair market value of Waits' services on both claims, and the jury returned identical $100,000 awards on each.65 Applying the rule to the established facts, the Lanham Act award for the fair market value of Waits' endorsement services duplicated the voice-misappropriation award for the same services, requiring vacation of the $100,000 Lanham Act damages.66
The damages awarded on the Lanham Act claim were duplicative and properly vacated.67