Reynolds

—In 1959 Jess S. Morgan, agent for plaintiff Debbie Reynolds, approached defendant H. G. Saperstein, an experienced “merchandiser of personalities,” in connection with the “merchandising” of Debbie Reynolds’ name. “Merchandising” of personalities consists of licensing manufacturers and retailers to attach the name of the personality to their product to promote their sales in exchange for a fee payable to the personality.

Morgan wished to use a corporation in order to avoid the effect of certain tax provisions unfavorable to Debbie Reynolds, and Saperstein agreed. The parties agreed to use a then existing corporation, defendant Special Projects, Inc., and plaintiff became the record holder of 73 shares of stock of Special Projects, Inc., out of a total of 150 outstanding shares.

Special Projects, Inc., through its president, H. G. Saperstein, began merchandising the name “Debbie Reynolds,” and expending money. All parties anticipated entering into a written agreement. On November 2, 1959, Saperstein mailed to plaintiff an interim agreement providing, among other things, a five-year exclusive license for the use of Debbie Reynolds’ name by defendant Special Projects, Inc. H. G.…