March 26, 2005
News in brief
Two Chinese firms are trying to back out of a contract to build a dam in Pakistan, asking for a renegotiation at "current market prices."
A "controversial" resort village project atop Colorado's Wolf Creek Pass will go forward, despite continuing contract battles among the various players.
Hawaiian Airlines will ask a bankruptcy court to impose a new contract on its pilots, who refused to ratify the deal struck by their union reps.
A Texas school district that sued a contractor for breach of contract has had to pony up $1 million to settle the dispute, after the contractor counterclaimed. "A bad settlement is better than a good lawsuit," a spokesman said.
Rapper Sean "P. Diddy" Combs, whose business difficulties have led to frequent appearances in these columns, has a new venture: he's going into the auto parts business to make custom wheels for trucks, SUVs, and luxury cars.
Recreational vehicle maker Thor America says it will close its plant in Middleburg, Pennsylvania, after workers overwhelmingly refused to accept a contract that would cut wages and increase incentive bonuses.
Today in history—March 26
1636: Utrecht University in the Netherlands formally opens its doors with 7 faculty members and 35 students.
1874: Poet Robert Lee Frost is born at San Francisco, California. He is second only to Thomas Jefferson in the number of times he is quoted in personal statements by law school applicants.
1930: Future U.S. Supreme Court Justice Sandra Day (O'Connor) (Stanford Law 1952), is born at El Paso, Texas.
1937: Spinarch growers erect a statue of Popeye the Sailor Man in front of the City Hall in Crystal City, Texas.
1959: Author Raymond Chandler, creator of the fictional detective Philip Marlowe, dies at La Jolla, California, at age 70.
1963: Willie and Lucille Peevyhouse won't get their 60 acres of Oklahoma restored, as the state supreme court decides Peevyhouse v. Garland Coal.
1973: The television soap opera The Young and the Restless debuts on CBS Television. It will become the number one rated soap for 16 consecutive years.
1996: The International Monetary Fund agrees to a $10.2 billion loan to Russia.
March 25, 2005
Nugent v. Muskegon: Day 3
The defense won a big victory Thursday in Ted Nugent's lawsuit against the Muskegon Summer Festival, as Judge Timothy Hicks ruled that the rocker can't claim damages based on work he lost because of the cancellation. Muskegon canceled his appearance on grounds that he had used racially offensive language, a charge that testimony Wednesday suggested caused Nugent to become a "pariah" in the music world.
Hicks's ruling means that even if Nugent proves a breach, his damages will be limited to the $80,000 fee he would have earned, not the $1 million in lost earnings that resulted.
I'm not a judge, but I play one on TV
Alec Baldwin plays Justice Robert Jackson in the TV mini-series Nuremberg: Infamy on Trial, and if you want to know his views on the Nuremberg trials he'll be appearing at Cardozo's big conference next week, The Nuremberg Trials: A Reappraisal and Their Legacy, which runs Sunday through Tuesday, March 27-29.
The actor, who actually took some political science courses before earning his BFA in Drama, will discuss things with Richard Weisberg, the Walter Floersheimer Professor of Constitutional Law and Director of the Program in Holocaust and Human Rights Studies at Cardozo, and Michael Marrus, the Chancellor Rose and Ray Wolfe Professor of Holocaust Studies at Toronto.
Baldwin appears Sunday, March 27, at 6:00—and will apparently be there for the reception following. No word if ex-wife Kim Basinger, who once also starred in a World War II mini-series, From Here to Eternity, will be present.
News in brief
Northwest Airlines breached its contract with labor unions when it refused to repurchase shares of stock in 2003 as it had promised, a New York judge rules.
The New York Appellate Division has affirmed a $550 million contract judgment won by Jones Apparel against Polo Ralph Lauren Corp.
A California jury hands Lexar Media a $380 million judgment in a trade secrets dispute with Toshiba Corp.
Financier Ron Perelman has won summary judgment on the liability phase of his fraud suit against Morgan Stanley, because the defendant investment bank "deliberately" violated repeated discovery orders.
Graduate students at the University of Michigan are locked in a dispute over salaries and benefits with the Ann Arbor school.
The purchaser who bought a Gustav Stickley sideboard once owned by Barbra Streisand for $600,000 is out of luck on its claim that the sideboard had undisclosed damage, since it waited more than four years to bring its claim and the piece had been sold "as is."
After a fourteen-year strike, California's Diamond Walnut Cooperative has agreed to a new five-year contract with the Teamsters Union.
PER doesn't bar sales reps' statements in negotiations
In the case, Honeysuckle Enterprises sought a franchise from Travelodge Hotels to operate a hotel in Branson, Missouri. Sales people from Travelodge allegedly told Honeysuckle that it would get “at least 15 percent reservations” from Travelodge if it joined. The contract, however, had two clauses:
Neither we nor any person acting on our behalf has made any oral or written representation or promise to you on which you are relying to enter into this Agreement that is not written in this Agreement. You release any claim against us or our agents based on any oral or written representation or promise not stated in this Agreement.
This Agreement, together with the exhibits and schedules attached, is the entire agreement superseding all previous oral and written representations, agreements and understandings of the parties about the Facility and the License.
When Honeysuckle refused to pay the franchise fees to Travelodge, the franchisor sued. Honeysuckle counterclaimed, seeking rescission for fraud in the inducement and various other claims, including promissory estoppel. Travelodge moved for summary judgment based on the parol evidence rule.
No dice, said Judge Joseph Greenaway, applying New Jersey law. The PER doesn’t bar evidence of fraud in the inducement, and the “no representations” clause is something that the jury may or may not choose to believe. If the contract was induced by fraud, it is voidable, and thus neither the "no representations" clause nor the integration clause would apply.
Travelodge Hotels, Inc. v. Honeysuckle Enterprises, Inc., No. 02-2889, 2005 U.S. District Lexis 2522 (D.N.J. Feb. 16, 2005).
Today in history--March 25
40 or 41: Jesus of Nazareth is crucified by Roman authorities at Jerusalem.
1634: The first settlers land in the new proprietary colony of Maryland. It is owned by Cæcilius Calvert, 2nd Baron Baltimore, the maiden name of whose wife is Anne Arundel.
1802: France and England sign the Treaty of Amiens, which purports to be a "Definitive Treaty of Peace" between them. Truth in advertising laws don't apply to governments.
1807: Great Britain becomes the first major nation to abolish the slave trade with enactment of the Slave Trade Act.
1894: In protest against unemployment caused by the Panic of 1893, Jacob Coxey leads a group of men from Massilon, Ohio, on a trek to Washington. "Coxey's Army," 500 strong, will reach the capitol in April, where they will disband after Coxey is arrested for walking on the Capitol grass.
1918: Future New York University Law Review editor Howard William Cohen is born at Winston-Salem, North Carolina. As "Howard Cosell" he'll give up law in 1954 to do a radio program featuring Little League players.
1931: Nine black teenagers are arrested for rape in Scottsboro, Alabama. One of them, Haywood Patterson, will ultimately be tried four times, getting death sentences in three successive trials before winning a 75-year term in the fourth.
1957: The Treaty of Rome creates the European Economic Community. The original members are Belgium, Frnace, Italy, Luxembourg, Netherlands, and West Germany.
2004: Air Holland goes bankrupt when business falls off after unproved allegations of marijuana use by pilots.
March 24, 2005
Well, the first six issues were free . . .
Christine Hurt of Marquette, who usually teaches corporate finance and torts, has a pretty good Contracts-related problem over at the Conglomerate blog, involving automatic renewal of a "free" magazine subscription given with the purchase of a piece of consumer electronics. You might want to give her some of your thoughts.
Nugent v. Muskegon: Day 2
The second day of Ted Nugent’s battle with the city of Muskegon focused on one of the critical issues in the case: Did a contract between the parties exist although the written agreement had not yet been signed.
Nugent’s lawyers put on expert witness testimony from his own entertainment lawyer, Mike Novak, who also represents acts like Kid Rock and Bob Seger. John Hausman of the Muskegon Chronicle, who is doing a far better job than most big-city reporters would do on a complicated contract dispute, reports on Novak’s testimony:
Nugent representatives contend they had an oral contract as of April 24, when the two sides agreed to Nugent's appearance at Heritage Landing for a fee of $80,000. Nugent's appearance was announced publicly May 2, and tickets went on sale May 3.
The start of ticket sales is "the point of no return," Novak testified. "Very, very few events are canceled" after that. He said the Nugent cancellation was shocking, the first time he had seen such a thing in 25 years.
"A contract is a contract," Novak said. "It's a huge misconception (to think a signed paper is needed). There may not have been a signed paper, but there was a contract."
The city backed out of the agreement on May 15. Trial is expected to go through most of next week.
Cyberspace in Music City
The ABA's Cyberspace Law Committee will be involved in a lot of things at the upcoming meeting in Nashville, and they'd love to have more law professors get involved. They're involved in a wide range of activities, including issues of electronic contracting. One panel of particular interest, which includes Chris Kunz and Dan Kleinberger of William Mitchell, will deal with indemnification clauses, and there's an excellent intro section for those who want a grounding in the basics of the e-commerce phenomenon. For Committee Chair Vince Polley's invitation, click below.
From Vince Polley,
ABA Cyberspace Law Committee
Earlier this week, the Business Law Section circulated the program book for Nashville. As you plan your calendar, I encourage you to include all of the programs sponsored by the Cyberspace Committee or planned by our Committee colleagues. (Spring Meeting registration information, program schedules, and more is at http://www.abanet.org/buslaw/2005spring/.) For your convenience, I’m including the program times and descriptions below.
For newer lawyers—and lawyers new to cyberspace practice—the Cyberspace Committee will present a "basics" panel at the Young Lawyers Institute. The ABCs of "E" (and "D")—What Every Business Lawyer Should Know About the Law of Electronic Commerce (and Discovery) will survey the basics of electronic contracting, jurisdiction, privacy, intellectual property, security and discovery. The ABCs program will be Thursday, March 31, 2005 from 11:30 a.m.-1:00 p.m. Renaissance Hotel, Fisk Room One, 2nd Floor.
Also, bring your laptops and your Wi-Fi cards. The Section will again be wiring the Spring Meeting hotel for Wi-Fi. If you don't bring a laptop, the Section will be providing a computer lab with high speed Internet access and printers for free, but there may be a wait during peak hours.
And, not to be missed, the Cyberspace Committee Dinner at the famous Wildhorse Saloon. The Committee Dinner will be Saturday, April 2, 2005 beginning at 6:30. The Wildhorse Saloon is renowned for the very best in live country entertainment, and the menu will include Wildhorse’s award winning smoked BBQ Pulled Pork Shoulder. Bring your best dancing shoes—free line dancing lessons will be offered all night. The Wildhorse promises "It’s country that kicks!" Dinner will be $45 per person and a cash bar will be located in our room.
We look forward to seeing you in Nashville.
Thursday, March 31, 2:30-4:30 p.m., Convention Center 2d Floor, Room 209.
Cyberspace Law Committee members should take particular note of the UCC Committee program Pitfalls of Indemnification Clauses. Chaired by Chris Kunz, the panel will focus largely on commercial indemnification clauses, including quite a bit of material on cyberspace and licensing issues contributed by Kate Andresen, who has considerable expertise about application service providers, and Joe Beckman, who is outside counsel for Digital River. The panel also includes Paula Duggan Vraa, an insurance law expert, and Prof. Daniel Kleinberger, who has been a reporter on the Uniform Limited Partnership Act and the Uniform LLC Act, in addition to his previous expertise in UCC Sales law and plain language contract drafting. It promises to be a lively panel, with no shortage of stories about what to guard against to keep your indemnification clauses from going awry.
Friday, April 1, 9:00-10:00 a.m., Convention Center 2d Floor, Room 204. Plenary Committee Meeting. During this plenary session we will have two "Hot Topics" presentations:
* RiskE Contracts: Threats to your online contracts in Europe by John Gregory and Don Clifford. This presentation will explore why 30 of the provisions of AOL France’s subscriber agreement were invalidated by a French court and explain how four European Union Directives could broaden the threat to 24 other countries.
* Director’s Guide on Data Governance by Roland Trope and Michael Power. This presentation will review directors’ emerging obligations for data governance (e.g., maintaining appropriate/adequate security measures) and identify topics that directors should discuss with senior management in order to fulfill such obligations and avert the risks of liability for material deficiencies in their organization’s digital security.
Friday, April 1, 10:00 a.m.-12:00 p.m., Convention Center 2d Floor, Room 204.
The Life Story of a Prepaid Card Program. Richard Hackett and Robert Ledig co-chair will this program addressing the legal, regulatory and strategic considerations associated with the development, structuring, implementation, operation and termination of two popular types of prepaid card programs: payroll cards and open system gift cards. The program will highlight the range of issues that face banks, non-banks and other card issuance participants in designing these products. This program is co-sponsored by the Consumer Financial Services Committee.
Friday, April 1, 2:30-4:30 p.m., Convention Center 2d Floor, Room 204.
Saturday, April 2, 8:00-10:00 a.m., Convention Center 2d Floor, Room 209.
Spam-Fighting Technologies and Their Legal Implications. Elizabeth Bowles chairs this program examining SPAM and "malware," which continue to plague the Internet, and the automated technology to which many have turned to stem the flood. Unfortunately, in blocking the bad, these potent technologies may also unintentionally block, destroy or delay crucial legitimate communications. This program examines current anti-spam technologies and the potential legal implications and pitfalls of their unintended effects.
Call for papers—Lavender Law
The 2005 Lavender Law Conference, October 27-29 in San Diego, is calling for papers, but the deadline is pretty short—April 1, to be precise. They're looking for a range of topics. For more information, click on the link below.
Announcement -- Request for Workshop Proposals
Lavender Law 2005 - San Diego
October 27th - 29th, 2005
Westin Horton Plaza
Every year, the sharpest legal minds in the LGBT community gather at Lavender Law®, the annual conference of the National Lesbian and Gay Law Association. Hundreds of practicing attorneys, law professors, law students, judges and legal professionals are expected to attend Lavender Law® 2005 - San Diego, California on October 27th - 29th at the Westin Horton Plaza Hotel.
Lavender Law attempts to provide the most challenging and rewarding learning experience possible for our attendees and presenters. In order to achieve that goal, Lavender Law asks that you look ahead to the future, propose a workshop, and do your best to meet our deadlines. These deadlines exist because Lavender Law operates with limited financial resources and staff and relies upon many volunteers to coordinate printed materials and meet CLE deadlines. Please do your best to get your proposal(s) in as soon as possible.
Lavender Law® offers dozens of panels, courses and plenary sessions on cutting-edge legal issues affecting LGBT individuals and the community, as well as a Career Fair. The country's leading legal thinkers -- both self-identified LGBT people, as well as our straight allies -- will instruct participants on practical litigation skills, constitutional law developments, will drafting and estate planning, employment discrimination, HIV/AIDS, immigration, workplace diversity, domestic violence, transgender and intersex issues, career development, and LGBT issues in the academy, the military, and the family.
If any special arrangements are required for a disabled individual, please call (202) 607-0732 by October 1, 2005. Lavender Law 2005 - San Diego looks forward to hearing your ideas!
On the lighter side
Courtesy of Steven Schooner at George Washington, this wry piece of (hopefully) fictional boilerplate.
Sorry, you win
There's a nice little battle brewing in New York, as a result of a foul-up in the Daily News's "Scratch-n-Match" game promotion. The paper's prize company misprinted the tickets, leading to many more "winners" than were anticipated. New York's WABC reports that angry "winners" are storming the paper's offices.
The paper is pointing to fine print in the game pieces which seems to let it off the hook. But legal action is certainly on the way. One woman had already booked trip to Disneyworld before she learned of the error.
Today in history—March 24
809: The greatest of the Abassid Caliphs, Haroun al-Rashid, inspiration for the Thousand and One Nights, dies while leading a debt collection expedition against the Byzantines.
1765: The first Quartering Act goes into effect in Britain’s American colonies. This will ultimately lead to the Third and perhaps least litigated amendment to the U.S. Constitution.
1855: Andrew William Mellon, who will start a lumber business at 17 and will go on to become one of America’s great financiers and treasury secretaries, is born at Pittsburgh, Pa.
1868: The Metropolitan Life Insurance Co. is chartered in New York.
1887: Roscoe Conkling "Fatty" Arbuckle is born at Smith Center, Kansas. He will earn an $1 million a year from Paramount Studios until his career is destroyed by scandal at age 34.
1898: Robert Allison of Port Carbon, Pa., becomes the first person to buy an American-built automobile. It's from the Winton Motor Carriage Co. of Cleveland, which in 1899 will become the biggest U.S. auto manufacturer, selling 100 vehicles.
1902: Future mob prosecutor and presidential candidate Thomas Edmund Dewey (Columbia Law 1925) is born at Owasso, Michigan. One of his legacies as New York governor is the State University of New York.
1905: Jules Verne, who gave up studying for the bar to create the modern science fiction genre, dies. He is said to be the most-translated novelist (148 languages) in history
1951: Fashion impresario Thomas Jacob Hilfiger, who will start his empire by retailing hippie fashions in Elmira, New York, is born there.
1970: Actress Lara Flynn Boyle, who plays ADA Helen Gamble on TV’s The Practice, is born at Davenport, Iowa.
1989: The tanker Exxon Valdez hits a reef and triggers the 53rd largest oil spill in history.
March 23, 2005
Nugent v. Muskegon: Day 1
The first day of rocker Ted Nugent’s suit against Muskegon, Michigan, went into the books Monday with testimony that the city’s cancellation substantially harmed Nugent’s career. Muskegon canceled the concert and issued a press release saying the action was caused by the guitarist’s use of "potentially offensive racial terms" during a radio interview. Nugent denies using such terms.
Nugent’s agent, Adam Kornfeld, testified that after Muskegon’s action bookings for Nugent dried up. Kornfeld, who has represented Nugent for 21 years, said that immediately after the Muskegon action, "The phones died. It seemed like Ted was a pariah."
In addition to his $80,000 contract fee, Nugent is seeking $1 million in damage to his career. Some of the terms from Nugent's standard performance contract are here.
A new law school ranking
In case you missed it, the good folks at the Social Science Research Network now are ranking law schools based on number of papers downloaded from the SSRN database. The Top 20 over the past 12 months are:
1 Harvard Law School
2 Stanford Law School
3 University of Chicago Law School
4 Columbia Law School
5 UCLA School of Law
6 University of Texas School of Law
7 George Mason University School of Law
8 University of California, Berkeley School of Law
9 Yale Law School
10 University of Virginia School of Law
11 George Washington University Law School
12 Georgetown University Law Center
13 New York University School of Law
14 Vanderbilt University School of Law
15 University of San Diego School of Law
16 University of Pennsylvania School of Law
17 University of Illinois College of Law
18 Boston University School of Law
19 University of Michigan Law School
20 Fordham University School of Law
News in brief
Two Wisconsin solons have introduced a bill requiring providers of services to business to send a notification letter to the customer before the contracts are automatically renewed.
A Minneapolis architecture firm is suing to keep a rival—who happens to be working with it on the same job at the moment—from pirating away five principals.
Irish airline Ryanair has run afoul of a Belgian court, which held that the firing of three Belgian employees hired in Ireland but working in Belgium was improper under Belgian law.
The galactic breach of contract battle between Activision and Viacom over the "Star Trek" line of video games has apparently been settled.
Canadian beer drinkers are breathing easier after 6,000 employees of The Beer Store reach tentative agreement on a new three-year contract.
Connecticut courts like arbitration
There are a number of good state-oriented legal blogs out there. Connecticut’s Kirby’s Reports is an excellent one, and while it’s primarily aimed at lawyers in the Nutmeg State, the fact that it summarizes all the recent Connecticut decisions means there’s often good stuff there for Contracts profs.
Two recent posts, for example, on cases involving arbitration agreements. In Board of Education v. Nonnewaug Teachers' Assn., the court held that an arbitration agreement was broad enough to include issues that the parties could not have anticipated, while in Industrial Risk Insurers v. Hartford Steam Boiler Inspection & Ins. Co., the court refused to even consider a claim that the arbitral award was unsupported by the evidence. The site has links to the decisions.
Today in history—March 23
1775: Virginia attorney Patrick Henry gives a speech before the Virginia House of Burgesses. "Is life so dear, or peace so sweet, as to be purchased at the price of chains and slavery? Forbid it, Almighty God! I know not what course others may take; but as for me, give me liberty or give me death!"
1839: The Boston Morning Post records the first use of "O.K." to mean "all correct."
1857: Elisha Otis installs the world’s first passenger elevator at E.V. Haughwout’s Emporium, a glass and porcelain dealer, at 488 Broadway, New York City.
1868: The University of California, the second-oldest state university in California (after San Jose State) is founded. State Chief Justice Serranus Clinton Hastings will give it a law school in San Francisco in 1878.
1903: Orville and Wilbur Wright apply for a patent for their newfangled flying machine.
1956: José Manuel Durão Barroso (Lisbon Law 1978), a law and political science professor who will go on to be prime minister of Portugal and President of the European Commission, is born at Lisbon.
1983: President Reagan announces plans to develop a space-based system to protect the United States from nuclear attack, a system its opponents promptly dub "Star Wars."
March 22, 2005
There are three Loyolas, three Washingtons, two Northwesterns, two St. Thomases—and now two John Marshalls among ABA accredited law schools. It's time we gave a warm (if belated) welcome to John Marshall Law School–Atlanta, which received ABA provisional accreditation last month.
JMLS-Atlanta is one of the relatively few schools whose dean (and, in this case, CEO) is a Contracts prof, John Ryan (left), who's previously served as acting dean at Pacific and founding dean at Roger Williams. Also teaching Ks at the school are Michael Lynch (formerly of Florida State and Toledo) and Jeffrey Van Detta, who joined the school in 1999 after practicing for 12 years at Atlanta's Kirkpatrick Stockton.