Jentry Kelley entered into a contract with Di Angelo Publications to publish her book Hooker to Looker to promote her cosmetics business. Di Angelo agreed to publish and distribute Kelley’s book with Kelley receiving 50% of the net royalties. Kelley provided Di Angelo with three pages, detailing her background and outlining the topics in her book. Di Angelo claimed it wrote the book while “communicating and/or collaborating with Kelley.” Di Angelo listed Kelley as the copyright holder to her book. Di Angelo sold its initial 1,000-copy print run, and Kelley asked Di Angelo to publish an updated edition. Di Angelo alleged that it prepared the updated work, but then discovered that Kelley attempted to work directly with Di Angelo’s printer to reduce her costs, which was a breach of her contract.
Kelley sued Di Angelo in Texas state court, claiming Di Angelo overcharged her for publishing her book. Kelley also claimed she was the sole owner of the copyright to her book and that Di Angelo did not develop any intellectual property in connection with Kelley’s book. Kelley asked the court to rescind her contract because of Di Angelo’s misrepresentations. Di Angelo counterclaimed, alleging, among other things, that Kelley prevented Di Angelo from publishing the updated edition, and sought a declaratory judgment that Kelley failed to substantially perform under the contract. In 2019, the court granted summary judgment to Kelley on certain Di Angelo counterclaims. The case is still pending.
In 2020, Di Angelo sued Kelley in federal court, seeking a declaratory judgment that Di Angelo owned the copyright to Kelley’s book and any derivative works. Kelley challenged federal jurisdiction, arguing that the claim was premised solely on her alleged breach of contract, which was governed by Texas law and not federal law. The district court agreed with Kelley and dismissed the lawsuit, but the Fifth Circuit reversed. The Fifth Circuit stated that Di Angelo’s claim implicates federal law definitions of “initial ownership” and “works made for hire,” so the Fifth Circuit remanded the case back to the district court for further proceedings.
You can view the opinion here: https://www.ca5.uscourts.gov/opinions/pub/20/20-20523-CV0.pdf