Case 1:16-cv-03984 Document 2 Filed 05/27/16 Page 1 of 16

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK
TERRENCE LOWENBERG,

Case No.: 16-cv-3984

Plaintiff,
COMPLAINT
-againstNICHOLAS SCHUTT and AUSTIN STARK,
Defendants.
Plaintiff Terrence Lowenberg (Plaintiff or Lowenberg), by his counsel Platzer,
Swergold, Levine, Goldberg, Katz & Jaslow LLP, as and for his Complaint against defendants
Nicholas Schutt (Schutt) and Austin Stark (Stark) (collectively, Defendants), alleges as
follows:
I.

NATURE OF CLAIMS
1.

This action arises from Defendants repeated and ongoing violations of Plaintiffs

copyrights in a screenplay, and its revisions, entitled The Herb (the Work), owned by
Plaintiff. Despite demonstrated knowledge and express acknowledgments of Plaintiffs ownership
of the Work and the copyrights thereto, Defendants have willfully infringed, and continue to
willfully infringe, upon Plaintiffs rights to the Work, to the detriment of Plaintiff and his property,
by improper conduct that includes, inter alia: (1) multiple acts of Defendants in direct
contravention of Plaintiffs ownership of the Work; (2) Defendants representing themselves as the
owners of the Work to third parties; (3) Defendants engaging in unauthorized marketing of the
Work to third parties; and (4) of primary importance, improperly withholding the Work from
Plaintiff.

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2.

Such improper conduct has caused, and continues to cause, damage to Plaintiff and

his ability to exploit the Work, as well as significant injury to his reputation and that of the Work.
Plaintiff has made due demand for the turnover of the Work from Defendants without compliance.
Defendants also continue to misrepresent the Work as their own and refuse to acknowledge
Plaintiffs established ownership of the Work and its copyrights despite repeated written
representations to the contrary.
3.

Accordingly, Plaintiff seeks declaratory relief from the Court confirming his

ownership of the Work and the copyrights thereto, and asserts claims against Defendants for
copyright infringement, breach of contract, breach of the duty of good faith and fair dealing,
conversion, tortious interference with contract, and fraud.
II.

JURISDICTION AND VENUE

4.

This action asserts claims arising under the Declaratory Judgment Act, 28 U.S.C.

2201 and 2202, and New York State law. This Court has jurisdiction over Defendants claims
pursuant to 28 U.S.C. 1331, 1338, and 1367(a).
5.

This Court has personal jurisdiction over Defendants because they regularly

transact business in the District and have committed tortious acts within this District causing injury
within this District. Stark is also a resident of this District.
6.
III.

Venue is proper in this District pursuant to 28 U.S.C. 1391(b) and 1400(a).

THE PARTIES
7.

Plaintiff is an individual with his place of business located at 419 Lafayette Street,

New York, New York 10003.

8.

Upon information and belief, Schutt is an individual residing at 717 South Cochran

Avenue, Los Angeles, California 90036.

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9.

Upon information and belief, Stark is an individual residing at 237 Lafayette Street,

New York, New York 10012.

IV.

FACTUAL BACKGROUND
A.

The Agreement and Plaintiffs Ownership of the Work and Its Copyrights

10.

Ownership of the Work and its copyrights was transferred by Schutt to Plaintiff, in

exchange for $25,000, pursuant to an agreement (the Agreement) set forth in signed electronic
communications, and evidenced by, inter alia, the Parties performance under the Agreement
including payment, voluminous subsequent communications, and other conduct demonstrating
Plaintiffs ownership of the Work and its copyrights as a matter of law.
11.

The Agreement and the Work arose as the result of conversations between Plaintiff

and Schutt (collectively, the Parties) about their experiences shared as close childhood friends
growing up in the wannabe gangster culture of the elite private school system of New York City
in the 1990s. The two resolved to create the Work utilizing Plaintiffs financial wherewithal as a
successful real estate developer, and relying on Schutts experience as an established screenwriter
in Hollywood.1
12.

Schutt suggested the title for the Work, The Herb".2

13.

Thereafter, the transfer of ownership of the Work and its copyrights from Schutt to

Plaintiff commenced in July of 2013, as evidenced by signed electronic communications which

demonstrate that: (a) Schutt agreed to transfer ownership of the Work, and all copyrights therein,
to Plaintiff; (b) in exchange for this transfer, Plaintiff agreed to pay Schutt the sum of $25,000.00;
(c) Schutt would draft the Work, including unlimited rewrites; (d) the Work would be drafted

Schutt was experienced in the screenwriting industry, and was familiar with the Copyright process, as
evidenced by his registration of prior Copyrighted works with the United States Copyright Office.
2
Upon information and belief, and based upon written statements of Schutt, the Work owned by Plaintiff
was constructed utilizing elements of a prior screenplay of Schutt of the same title.

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with the intention of being made into a film; and (e) although Schutt transferred full ownership of
the Work and its copyrights, Plaintiff and Schutt agreed that Schutt would receive a percentage of
the picture, in the amount of ten percent (10%).
14.

Initially, by email to Plaintiff dated July 24, 2013, Schutt set forth terms of the

Agreement under which he would create the Work with Plaintiff and, in exchange for payment
from Plaintiff, convey ownership in the Work and its copyrights to Plaintiff, in relevant part,
stating:
I see THE HERB as a dark comedy set in 1995 a bittersweet
valentine to New York [in] the edgy heyday of the mid 90s [set
within] a classic coming of age structure.
****
By paying me to write the script youd own the screenplay.
****
I am happy to do the first part of the deal, the writing part of it, with
you on the up and up without my lawyer and not bring my people in
until AFTER weve settled on a script and are going out to hire
talent, raise money.
****
Let me know if and how youd like to proceed.
****
Nick Schutt
(emphasis included in original)
15.

In the same email, Schutt proposed that, although Plaintiff would own the Work

and its copyrights, Schutt would to receive a percentage of the motion picture and a producer
credit, by stating, in relevant part, as follows:
Id want a producer credit and 5% of the picture
****
By paying me to write the script youd own the screenplay. Based
on the deals we cut with talent, directors, etc youd have 95% of the
movie to use as incentive for people to join.
Nick Schutt

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16.

Schutt followed his initial email with a subsequent communication to Plaintiff on

the same day that reiterated and further detailed the terms of the Agreement, in relevant part,
stating:
For now let's just focus on the cost of writing the script and worry
about everything else -- producing, etc -- when we finish the script.
****
Would you be amenable to 30K? I'll throw in unlimited rewrites. I'll
leave out my lawyers, and agents and managers -- I'd still consider
you the "owner" of the script but we agree that its a 90-10 split [of
the picture].
****
Dates remain the same. First draft deliverable to you end of
August.
****
Nick Schutt
17.

By email, also dated July 24, 2013, Plaintiff immediately responded to Schutt as

follows:
How about 25K to start? I think we will both end up making a lot
of money.
18.

Later on the same day, by email dated July 24, 2013, Schutt acquiesced to the

Agreement by providing the following unequivocal response to Plaintiff:

Deal
****
Nick Schutt
19.

Pursuant to the Agreement between the Parties, by email, Schutt provided his bank

account information and wire instructions to Plaintiff for payment under the Agreement.
20.

Pursuant to the Agreement, Plaintiff immediately transferred the agreed-upon sum

of $25,000 to Schutt by wire as instructed.

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B.

The Parties Performance Under the Agreement

21.

Pursuant to the Agreement, on September 3, 2013, Schutt delivered to Plaintiff an

initial draft of the Work (the 2013 Draft).

22.

Delivered within just weeks of the Agreement, the 2013 Draft represented a

preliminary work subject to comment by Plaintiff and revision by Schutt pursuant to the terms of
the Agreement.
23.

After receipt of the 2013 Draft, Plaintiff indicated to Schutt that the next draft of

the Work (the 2013 Revision) required substantial changes.

24.

Over the next two (2) years, Schutt regularly represented to Plaintiff that he

continued to work on the 2013 Revision, as evidenced by periodic email communications which
include statements such as: (a) [t]he script will need at least another re-write; (b) Im
banging away at a second draft ; (c) Im halfway through the rewrite; and (d) Im headed
to the Hamptons for a long needed vacation this Friday. I plan on finishing the second draft of
The Herb out there .
25.

Schutt indicated that progress was slow because of his conflicting work schedule

as a television writer. However, throughout this period, both orally and through email, Schutt
consistently represented to Plaintiff that he continued to work on the 2013 Revision owned by
Plaintiff.
C.

The Unauthorized Participation of Stark

26.

On July 4, 2015, Plaintiff first discovered that Stark was potentially involved with

the 2013 Revision with Schutt, without Plaintiffs authorization. In this regard, at a gathering at
Plaintiffs home, Stark informed Plaintiff for the first time, that he planned to work with Schutt
on the 2013 Revision.

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27.

Plaintiff immediately informed Stark that he owned the copyrights in the Work and

that Starks participation in the 2013 Revision was unauthorized.

28.

Plaintiff immediately contacted Schutt to protest the unauthorized involvement of

Stark in the 2013 Revision, and Schutt represented that Starks involvement would be primarily
based upon directing a finalized script if Plaintiff chose to proceed with making the film. This
representation was confirmed in an email from Schutt to Plaintiff, dated July 6, 2015, which stated
in relevant part:
All [Stark] wants to do is direct [the Work]. [Stark] thinks he can
do it for $ 3 Million. Any agreement that we would arrive at once
everyone felt comfortable [with] the script.
****
Nick Schutt
29.

Schutt requested that Plaintiff wait until the 2013 Revision was complete to make

a decision with respect to Starks involvement. By email, dated July 6, 2015, in relevant part,
Schutt stated:
So, as you're aware Austin Stark and his crew have sparked to THE
HERB and are very keen on developing it to make it. Based on my
conversation with him you are not as keen to go down the road they
see this project going. Which is too bad but I'd urge you to wait and
see how the next draft of the script turns out before making a
decision!
****
Nick Schutt
30.

In a later communication to Plaintiff on the same day, Schutt again acknowledged

Plaintiffs ownership and control over the 2013 Revision being produced at that time, stating:
You [Plaintiff] get the script first and then we can either go forward
or not.
****
Nick Schutt

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31.

These communications, as well as all other communications from Schutt

throughout this period, consistently indicate that Schutt was working on the 2013 Revision of the
Work owned by Plaintiff. At no time during this period did Schutt indicate to Plaintiff in any way
that he was creating a separate work. The same is true for Stark.
32.

Throughout this period, Plaintiff repeatedly communicated his ownership of the

2013 Revision and its copyrights to Defendants without objection from them.
D.

The Unauthorized Marketing of the Work

33.

On December 16, 2015, at a holiday gathering, to Plaintiffs surprise, Stark

informed Plaintiff that Defendants had nearly completed the 2013 Revision and that Plaintiff
should expect a copy of the 2013 Revision upon its completion.
34.

Although Plaintiff had not received a copy of the completed 2013 Revision from

Defendants, on and after March 16, 2016, Plaintiff received multiple notices from multiple sources
that Defendants were publicly marketing the Work, in their own names, without any notice to or
authorization from Plaintiff.
35.

Plaintiff discovered that Defendants were publicly marketing the Work as their own

in widely-distributed and highly-visible online media resources such as the Internet Movie
Database and Instagram, which had, in fact, been viewed independently by many associates of
Plaintiff.
36.

Unauthorized representations made by Defendants in these public marketing

materials included statements that: (i) the Work was co-written by Schutt and Stark; (ii) the Work
was in development with Stark, as director; (iii) the Work was being produced by individuals
unknown to Plaintiff; and (iv) the Work involved a plotline unseen and unapproved by Plaintiff.

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E.

Defendants Refusal to Cease Unauthorized

Marketing and Provide the 2013 Revision to Plaintiff

37.

After receiving notice of the unauthorized marketing activities of Defendants,

Plaintiff demanded that Defendants immediately terminate all marketing of the Work and provide
a copy of the 2013 Revision in its current form.
38.

Defendants failed to remove the unauthorized marketing materials and ignored

Plaintiffs demands.
39.

By email, dated March 29, 2016, Schutt explained the refusal to turn over the 2013

Revision, stating in relevant part:

I wrote a draft of The Herb in 2006. And you invested in a second
draft in 2013. And in the 3 years since I have continued to work to
make this movie a reality.
****
We want to make a few tweaks to the script so it's perfect and then
I'll mail you a hard copy along with a summary as promised.
****
I'll give you a heads up once the materials are in the mail.
40.

Defendants have failed to provide the 2013 Revision to Plaintiff, despite due

demand.
41.

Upon information and belief, Defendants have asserted the following positions

relating to the Work: (i) that the Agreement did not validly transfer of ownership of the copyrights
in the Work to Plaintiff; and (ii) that the 2013 Revision constitutes a separate work unrelated to
the Work owned by Plaintiff.
42.

Such assertions by Defendants are consistently refuted by the multitude of signed

electronic communications between the Parties, other available evidence, as well as continuous
representations made by Schutt to Plaintiff with respect to the Agreement, the Work, and the 2013
Revision, since the inception of the Agreement.

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F.

Schutt Consistently Misled Plaintiff Regarding His Actions

43.

For nearly three (3) years, Schutt regularly made misrepresentations to Plaintiff

that, inter alia: (i) he acknowledged the validity of the Agreement and Plaintiffs ownership of the
Work and its copyrights; and (ii) he was drafting the Work for the benefit of Plaintiff during this
period.
44.

For example, Schutt continuously represented orally and in writing that the

Agreement was valid and acknowledged that Plaintiff was the owner of the Work.
45.

In addition, despite recent assertions and conduct to the contrary by Defendants,

during all relevant periods, Schutt repeatedly represented to Plaintiff that he was working on the
2013 Revision for the benefit of Plaintiff and that the 2013 Revision was owned by Plaintiff.
46.

Finally, Schutt misrepresented the involvement of Stark with respect to the Work

and the 2013 Revision.

47.

Such misrepresentations were reasonably relied upon by Plaintiff to his detriment,

causing material damage to Plaintiff including, inter alia: damage to his reputation, damage to the
Work and its integrity, and inhibiting Plaintiff from taking actions to protect his rights to the Work
and to prevent Defendants from preparing and/or utilizing a competing script to Work.
G.

Stark Tortiously Interfered with the Agreement to the Detriment of Plaintiff

48.

Stark also tortiously interfered with the contractual relationship between Plaintiff

and Schutt. To this end, at all times, Stark was fully aware of the Agreement and the involvement
of Plaintiff with respect to the Agreement.
49.

Despite such knowledge, Stark intentionally interfered with the contractual

relationship by compelling and/or facilitating breach of the Agreement by Schutt in an effort to

profit financially to the detriment of Plaintiff.

10

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50.

Stark was aware that such improper conduct would cause damage to Plaintiff and,

most significantly, would serve to impair Plaintiffs legal rights to the Work and 2013 Revision.
H.

Defendants Conduct Has Materially Damaged Plaintiff

51.

Based upon the forgoing allegations, Plaintiff has suffered, and will continue to

suffer damages, including, inter alia, irreparable harm.

52.

Plaintiff is entitled to a declaration from this Court regarding his ownership of the

Work and the 2013 Revision and the copyrights thereto, injunctive relief enjoining Defendants
from further usage and infringement of the Work, an order directing that Defendants provide the
2013 Revision to Plaintiff, statutory and monetary damages based upon infringement of Plaintiffs
copyright ownership in the Work, monetary damages in an amount to be determined at trial, and
other relief determined to be just by the Court.
COUNT I
(Declaratory Judgment that Plaintiff Owns the Copyrights to the Work)
53.

Plaintiff repeats and realleges the allegations contained in each of the preceding

paragraphs as if fully set forth herein.

54.

An actual and justiciable controversy exists between the parties as to whether

Plaintiff owns the copyrights in the Work and 2013 Revision.

55.

The transfer of ownership of the Work and its copyrights from Plaintiff to Schutt

pursuant to the Agreement constitutes a valid transfer satisfying the requirements of Copyright
Laws.
56.

The 2013 Revision is part of the Work in which Plaintiff owns the copyrights

pursuant to the Agreement.

57.

Plaintiff has no adequate remedy at law.

11

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58.

Plaintiff is entitled to a declaratory judgment, pursuant to 28 U.S.C. 2201 and

Fed. R. Civ. P. 57, that Plaintiff owns the copyrights in the Work, including the 2013 Revision, in
its current form and any other revisions.
COUNT II
(Copyright Infringement Against Defendants Pursuant to 17 U.S.C. 106 and 501)
59.

Plaintiff repeats and realleges the allegations contained in each of the preceding

paragraphs as if fully set forth herein.

60.

Plaintiff owns the copyrights in the Work and any revisions or derivative works.

61.

Upon information and belief, without authorization from Plaintiff, Defendants

copied original elements of the Work and misappropriated the intellectual property of Plaintiff for
their own purposes.
62.

Defendants acts of infringement are wilful, intentional and purposeful, in disregard

of and with indifference to Plaintiffs rights.

63.

As a direct and proximate result of said infringement by Defendants, Plaintiffs are

entitled to damages in an amount to be proven at trial.

COUNT III
(Conversion Against Defendants)
64.

Plaintiff repeats and realleges the allegations contained in each of the preceding

paragraphs as if fully set forth herein.

65.

Plaintiff owns the Work, including the 2013 Revision and all related derivative

works, and the copyrights thereto.

66.

Plaintiff has repeatedly demanded that Defendants provide the Work to him.

12

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67.

By their conduct alleged herein, Defendants intentionally interfered with Plaintiffs

rights, exercising dominion and control over the 2013 Revision and refusing to turn over the 2013
Revision to Plaintiff.
68.

Plaintiff has been injured as a result of said conduct.

69.

By reason of the forgoing, Defendants are liable to Plaintiff in an amount to be

proven at trial.
COUNT IV
(Breach of Contract Against Schutt)
70.

Plaintiff repeats and realleges the allegations contained in each of the preceding

paragraphs as if fully set forth herein.

71.

Schutt entered into the Agreement with Plaintiff to create and revise the Work and

transfer copyrights in the Work to Plaintiff in exchange for the sum of $25,000 from Plaintiff.
72.

Although Plaintiff duly paid said sum to Schutt, Schutt breached the Agreement by

failing to deliver the Work as required under the Agreement.

73.

By reason of the forgoing, Schutt is liable to Plaintiff in an amount to be proven at

trial not less than $25,000.

COUNT V
(Breach of Duty of Good Faith and Fair Dealing Against Schutt)
74.

Plaintiff repeats and realleges the allegations contained in each of the preceding

paragraphs as if fully set forth herein.

75.

As set forth above, Schutts bad faith conduct constitutes a breach of good faith and

fair dealing that deprived Plaintiff of his rights to receive the benefits of the Agreement and/or
rights which were justifiably understood by Plaintiff to be included in the Agreement.

13

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76.

Schutt acted in bad faith by, inter alia, his repeated misrepresentations to Plaintiff

make either recklessly or knowingly over a number of years regarding: (i) the validity of the
Agreement between the Parties; (ii) Schutts acknowledgment of Plaintiffs ownership of the Work
and its copyrights; and (iii) representations to Plaintiff that the work performed on the 2013
Revision and otherwise was for the benefit of Plaintiff and the Work owned by Plaintiff.
77.

This deceptive conduct and other related conduct of Schutt has caused specific

damage to Plaintiff and his intellectual property. If in fact Defendants were working on a separate
project while representing to Plaintiff that they were working on the 2013 Revision, Schutts
misrepresentations to Plaintiff had the effect of preventing Plaintiff from protecting his rights for
an extended period of time while Defendants created a competing script using the very same title
and content derivative of the Work owned by Plaintiff.
78.

By virtue of the foregoing, Schutt is liable to Plaintiff in an amount to be proven at

trial.
COUNT VI
(Tortious Interference Against Stark)
79.

Plaintiff repeats and realleges the allegations contained in each of the preceding

paragraphs as if fully set forth herein.

80.

The Agreement between Plaintiff and Schutt was known to Stark.

81.

Stark intentionally interfered with the contractual relationship through his

unauthorized activities with respect to the 2013 Revision and the Work.
82.

Plaintiff has been injured as a result of said conduct by Stark, inter alia, depriving

him of the completed Work or 2013 Revision.

83.

By reason of the forgoing, Stark is liable to Plaintiff in an amount to be proven at

trial.
14

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COUNT VII
(Fraud Against Schutt)
84.

Plaintiff repeats and realleges the allegations contained in each of the preceding

paragraphs as if fully set forth herein.

85.

For nearly three (3) years, Schutt regularly made misrepresentations to Plaintiff

that, inter alia: (i) Schutt acknowledged the validity of the Agreement; (ii) Schutt acknowledged
Plaintiffs ownership of the Work, including the 2013 Revision, and its copyrights; and (iii) Schutt
was drafting a screenplay for the benefit of Plaintiff.
86.

Plaintiff reasonably relied upon these misrepresentations to his detriment.

87.

Upon information and belief, Schutt now asserts a contradictory position with

respect to the validity of the Agreement and ownership of the 2013 Revision and its copyrights
which, if true, necessarily demonstrates that his prior statements to Plaintiff were not only false
but known by Schutt to be untrue at the time that they were made.
88.

Significantly, upon information and belief, Schutt now asserts that the 2013

Revision produced by Defendants is an entirely separate work unrelated to the Work owned by
Plaintiff, directly contradicting his prior statements to Plaintiff with respect to the nature of the
2013 being produced, and express acknowledgments of Plaintiffs ownership of the 2013 Revision
and its copyrights while being produced.
89.

This conduct and other related conduct of Schutt has caused specific damage to

Plaintiff and his intellectual property. If in fact Defendants were working on a separate project
while representing to Plaintiff that they were working on the 2013 Revision, Schutts
misrepresentations to Plaintiff had the effect of holding Plaintiff at bay for an extended period of

15

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time while Defendants created a competing script using the very same title and content derivative
of the Work.
90.

By virtue of the foregoing, Schutt is liable to Plaintiff in an amount to be proven at

trial.
PRAYER FOR RELIEF
WHEREFORE, Plaintiff respectfully requests that the Court enter judgment in his favor
and against Defendants: (i) declaring that Plaintiff owns the copyrights in the Work, including the
2013 Revision in its current form, and any other derivative works; (ii) directing Defendants to
provide the 2013 Revision to Plaintiff along with any other derivative works; (iii) damages in an
amount to be determined at trial; and (iv) awarding Plaintiffs costs and attorneys fees pursuant
to 17 U.S.C. 505; and (v) granting such other and further relief in favor of Plaintiff as this Court
deems just and proper.
DEMAND FOR JURY TRIAL
Plaintiff demands a trial by jury on all issues so triable in this action.
Dated: New York, New York
May 27, 2016
PLATZER, SWERGOLD, LEVINE,
GOLDBERG, KATZ & JASLOW, LLP
By:

____s/ Joseph P. Cervini, Jr.________

Joseph P. Cervini, Jr.
475 Park Avenue South
New York, New York 10016
Telephone: (212) 593-3000
Facsimile: (212) 593-0353
Counsel for Plaintiff, Terrence Lowenberg

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