Case: PM & J Productions v. U-Haul Co. of Florida

Case no: 06-04981

Description: Negligence and conversion

Filing date: March 14, 2006, amended May 2011

Trial dates: Oct. 15-29, 2012

Judge: Miami-Dade Circuit Judge Beatrice Butchko

Plaintiff attorneys: Michael S. Olin and Alaina Fotiu-Wojtowicz, Michael S. Olin P.A., Miami; Joel Perwin, appellate attorney

Defense attorney: William V. Custer and James Gibson, Bryan Cave LLP, Atlanta; David Tarlow, Quintairos Prieto Wood & Boyer P.A., Fort Lauderdale; Charles Houston, corporate counsel for U-Haul, Phoenix

Jury verdict: $2 million

Details: PM & J Productions is a high-end, Miami-based niche producer of classical music recordings featuring prominent artists such as the late pianists Earl Wild and David Bar-Illan and contemporary pianists Joseph Kalichstein and Ivan Davis under the Audiofon label. The company is headed by Peter McGrath, a leading audio engineer, and Julian Kreeger, a lawyer, master pianist, longtime classical music impresario and 28-year chair of Miami’s Friends of Chamber Music. Kreeger is the husband of retired Miami-Dade Circuit Judge Judy Kreeger.

In approximately 1994, PM & J began storing 400 high-quality, reel-to-reel analog master tapes of artists’ performances at the U-Haul storage facility at South U.S. 1 and Ludlum Road (67th Avenue) near South Miami. There were approximately 26 CDs worth of releasable music on the tapes. The sonic and artistic qualities of the LPs and CDs issued from some of the tapes, recorded from 1979 to 1990, were written up favorably in audio magazines and newspapers.

Also in the storage unit was the partners’ hand-built Mark Levinson reel-to-reel recorder.

In 2000-2001, U-Haul developed a problem with a computer system it used to keep track of defaults. Although PM & J was never in default of its $197 monthly bill for storage, the computer began registering a default in summer 2001.

At the same time, a parallel U-Haul computer system issued invoices to PM & J and acknowledged receipt of PM & J’s payments, declaring PM & J’s account in good standing.

PM & J got no letters or calls that anything was awry in the billing. U-Haul claimed that it tried to call and sent default letters.

On Dec. 28, 2001, U-Haul auctioned off the goods and closed PM & J’s locker.

PM & J continued making timely payments for December, January and February. U-Haul accepted and cashed the checks.

That changed on March 15, 2002, when U-Haul called Kreeger and asked why he was sending checks, since the locker had been closed for 2½ months.

Once Kreeger and PM & J learned of the auction and disappearance of their tapes, they wrote and called U-Haul, asserting a claim in a March 25, 2002, letter. Within U-Haul, the issue was never turned over to the claims department, and U-Haul destroyed its files on the case in December 2003, two years after the auction.

PM & J filed suit March 14, 2006, accusing U-Haul of negligence and conversion. In its May 2011 amended complaint, PM & J said that U-Haul first said it knew where the property was, then said it was inquiring to find out what had been done with it and asked for time to investigate, which the complaint said “lulled the plaintiff into a disadvantageous legal position.”

Plaintiff case: Michael Olin was retained as counsel for PM & J in early 2010, and the litigation quickly began to move toward trial.

“The master and session tapes that were stored in the leased storage space have both great historical importance and great artistic merit,” the amended complaint said. “They cannot be duplicated.”

The trial began Oct. 15 and hinged on the questions: What is the art’s value? Should the value be determined in the marketplace or by some other standard? Applying a value to owner standard in jury instructions, the judge said the jury’s decision should determine, among other things, the uniqueness of the property, its artistic and historic significance, and the “opinion of the owner as to its value.”

Defense case: William V. Custer of Bryan Cave argued that PM & J deserved some compensation for its loss but not nearly as much as requested. He suggested $93,000 was appropriate. U-Haul also argued that the producers should have followed up more aggressively, had chosen to put master tapes in a storage area that lacked air conditioning, and had answered an interrogatory in 2006 valuing the tapes at “in excess of $100,000.” U-Haul thus asserted that the tapes had much less value to PM & J than it claimed at trial.

After a summary judgment for plaintiff on conversion and an agreement that U-Haul was negligent, the case went to the jury on three issues: the proper amount of compensatory damages, whether plaintiff was entitled to punitive damages and, if so, the amount of punitive damages.

Outcome: The jury deliberated about 75 minutes. It awarded PM & J $500,000 in compensatory damages and $1.5 million in punitive damages.

Comments: “The jury made a reasoned decision,” Olin said. “Music and sound have been passions of Julian Kreeger and Peter McGrath all their lives. These tapes were unique, irreplaceable recordings of some of the greatest classical music artists in the world, and they are now lost.”

Post-verdict: The defense has indicated that it intends to appeal.