Tom Doherty Associates, Inc. v. Saban Entertainment, Inc.

Tom Doherty Associates, Inc., doing business as TOR Books (TOR) (plaintiff), entered into a contract with Saban Entertainment, Inc. (Saban) (defendant), a creator, producer, and distributor of television for children. The contract provided that TOR would immediately publish six children’s books with characters from Saban’s television programming, and further created a long-term relationship giving TOR certain exclusive rights to publish children’s books with Saban’s characters. For Saban, the contract would be a means of promoting and selling children’s books featuring Saban’s characters. For TOR, which was only a minor publisher of children’s books, the contract was an opportunity to expand TOR’s role and establish itself in this specialized market. After the execution of the contract, Saban introduced the television show Power Rangers, which became wildly successful. After the success of Power Rangers, Saban no longer needed TOR to promote its content by publishing children’s books. Saban accordingly gave licenses to other publishing houses to publish Power Rangers books. TOR brought action against Saban for breach of contract. TOR then moved for a preliminary injunction, arguing that TOR would suffer irreparable harm in the form of the loss of a unique opportunity if Saban did not license publishing rights to TOR for Power Rangers books. The district court granted the preliminary injunction, finding that the Power Rangers books “[were] likely to transform TOR’s fortunes.” Saban appealed, arguing that loss of future goodwill could not constitute irreparable harm justifying injunctive relief.