ContractsProf Blog

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Valparaiso Univ. Law School

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Friday, September 8, 2006

A Million Little Refunds

The New York Times reports that a settlement has been reached in the consolidated cases by readers who sued Random House and James Frey when they found out his book A Million Little Pieces was not quite a memoir.  Want your refund?  According to the New York Times, here's what the settlement requires:

To claim a refund, readers who bought a copy of the book on or before Jan. 26 must submit proof of purchase. This will not be limited to a dated receipt however: hardcover buyers, who are entitled to a $23.95 refund, must submit page 163 (chosen at random, according to the source familiar with the negotiations); paperback buyers (entitled to $14.95) must send in the front cover of the book; those who bought the audio book ($34.95) will have to send in a piece of the packaging, and those who bought the e-book, at $9.95 apiece, must send in some proof of purchase.

People making a claim will also have to submit a sworn statement that they would not have bought the book if they knew that certain facts had been embroidered or changed.

Seems like you'd just be getting back the jacket price - no compensation for the time you spent reading the apparently wrenching (and believable?) description of undergoing dental work without Novocaine.

[Meredith R. Miller]

September 8, 2006 in In the News | Permalink | TrackBack (0)

Thursday, September 7, 2006

Contracts Research Canon

Over at Prawfsblawg, where I will be guest blogging for the next few weeks, Matt Bodie (Hofstra / St. Louis) has proposed the idea of Research Canons for different legal subject areas.  He describes the project this way:

Unlike other disciplines, most law academics do not have an advanced degree in "law."  For students pursuing a Ph.D in areas such as economics, history, or social psychology, they must pass comprehensive exams showing that they have a broad knowledge of the most important works in the field.  It is only after comps that students go on to complete their specialized dissertation research.

Legal academia assumes that entry-level candidates and new scholars have done the background research necessary for their area of expertise.  But it is left to the individual to get this knowledge.  Certainly, the J.D. provides a baseline, and mentors are helpful in providing further direction.  But there is nothing akin to comps that sets forth a comprehensive listing for new folks to follow.  Many of us have heard the question, in the AALS interview, in the job talk, or as a new scholar presenting a paper: "Well, of course, you have read the work of Prof. X in this area, right?"  Failure to respond appropriately to this question may raise eyebrows and cast doubt on the scholar's research.

Prawfs recently posted the Canon for Contracts and it would be great if we could add our input to their already growing list of scholarship.

[Miriam Cherry]

September 7, 2006 in Recent Scholarship | Permalink | TrackBack (0)

EULAs in English

Aaa_84 Virtually every human being who has ever used a computer has a contract with Microsoft Corp.  The contract is the End User License Agreement that comes with Windows software.  The EULA is a formidable piece of legal drafting, but (rather like the software it covers) it's not the most user-friendly thing around.

The folks at LINUX Advocate -- whose goal in life seems to be turning MS Windows into a 21st century Betamax -- have come up with an English translation of the EULA.  Interestingly, the language in the license agreement for LINUX is somewhat more understandable than Microsoft's, but you wind up getting much the same remedies:

. . . THERE IS NO WARRANTY FOR THE PROGRAM, TO THE EXTENT PERMITTED BY APPLICABLE LAW. EXCEPT WHEN OTHERWISE STATED IN WRITING THE COPYRIGHT HOLDERS AND/OR OTHER PARTIES PROVIDE THE PROGRAM "AS IS" WITHOUT WARRANTY OF ANY KIND, EITHER EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. THE ENTIRE RISK AS TO THE QUALITY AND PERFORMANCE OF THE PROGRAM IS WITH YOU. SHOULD THE PROGRAM PROVE DEFECTIVE, YOU ASSUME THE COST OF ALL NECESSARY SERVICING, REPAIR OR CORRECTION.

IN NO EVENT UNLESS REQUIRED BY APPLICABLE LAW OR AGREED TO IN WRITING WILL ANY COPYRIGHT HOLDER, OR ANY OTHER PARTY WHO MAY MODIFY AND/OR REDISTRIBUTE THE PROGRAM AS PERMITTED ABOVE, BE LIABLE TO YOU FOR DAMAGES, INCLUDING ANY GENERAL, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OR INABILITY TO USE THE PROGRAM (INCLUDING BUT NOT LIMITED TO LOSS OF DATA OR DATA BEING RENDERED INACCURATE OR LOSSES SUSTAINED BY YOU OR THIRD PARTIES OR A FAILURE OF THE PROGRAM TO OPERATE WITH ANY OTHER PROGRAMS), EVEN IF SUCH HOLDER OR OTHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

[Frank Snyder -- hat tip to InfoWorld]

September 7, 2006 in E-commerce | Permalink | TrackBack (0)

Football Star Sues Insurer

Aaa_82 A new lawsuit by former Denver Broncos star Terrell Davis may raise some interesting issues about insurance companies’ obligations to pay for their clients’ legal representation. Seems that during a party following the Emmy Awards last fall, Davis had an altercation with bouncers at the Hollywood Roosevelt Hotel bar. He says the staff made racially offensive remarks and that he was physically assaulted by two bouncers. He sued the hotel and the bouncers.

To this point, his insurer, Liberty Mutual had nothing to do with this.  But then one of the bouncers cross-claimed against Davis for assault and battery.  An insurer ordinarily has no duty to defend against an intentional tort, but it seems the bouncer for some reason added a negligence count -- although from the description of events it sounds like the bouncers either deliberately attacked Davis or vice-versa.  Liberty Mutual refused to provide coverage, and Davis is suing.

[Frank Snyder]

September 7, 2006 in In the News | Permalink | TrackBack (0)

Where Dickinson's Agent Met Dodds

Bbb_1 Speaking of old contract law chestnuts, how about Dickinson v. Dodds?  In the case, one Dodds made a written offer to one Dickinson, to sell certain dwelling-houses and property at Croft (a village near Darlington in Yorkshire) for £ 800, "[t]his offer to be left open until Friday, 9 o'clock a.m., 12th June 1874."  Before that time expired, Dickinson learned that Dodds was apparently also offering to sell it to one Allan.  Dickinson tried to accept the offer, and his agent Berry finally managed to run Dodds down in the Darlington railway station and hand him the written acceptance two hours before the deadline, at 7:00 a.m. Friday morning.  Dodds refused to sell him the property, saying that he had already sold it to Allan.

The questions for the court were (1) are offers unsupported by consideration revocable at will, even when the offeror has stated that it will be held open for a specific period? and (2) was Dodds's offer somehow revoked before Dickinson delivered the acceptance?  Held:  Yes and yes.  The former ruling became black letter law, but the latter is still a little controversial.

The present Darlington Railway Station, with a fine Victorian clock tower, dates only from 1887, a half-dozen years after the case.  The actual building where Dickinson's agent confronted Dodds is the old station, now known as the "North Road" station, shown in the accompanying picture.  It's now the site of the Darlington Railway Centre and Museum.  The story is that the Stockton & Darlington Railway built the new station because Queen Victoria visited the old one and found it shabby.

[Frank Snyder]

September 7, 2006 in Famous Cases | Permalink | TrackBack (0)

Wednesday, September 6, 2006

Images of New Headley Tobacco Warehouse

Aaa_80 Bbb For those who use the Epstein-Markell-Ponoroff casebook, or another book that teaches New Headley Tobacco Warehouse Co. v. Gentry's Executor, here are two views of the Tobacco Warehouse district in Lexington, Kentucky, taken in 1931, the year before the contract at issue in the case was negotiated.

The case is a "dying offeror" staple.  Gentry executed a lease of property in Lexington to New Headley for a 22-year term at $1,200 a year.  Ten years into the lease, Gentry sent a letter to New Headley, saying that if New Headley built a specified improvement worth at least $25,000 on the property before 1947, he would extend the lease for 22 years from the date the improvement was built.  New Headley made no effort to start work on the improvement before Gentry died in 1945.  New Headley subsequently tried to accept the offer but the executor refused.  The question for the court was whether Gentry's death terminated the offer.  Held:  Yes.  Even though the offer formally gave New Headley until 1947 to accept, it was revocable at any time, and hence was revoked by Gentry's death.

The images are from the Kentuckiana Digital Library, whose site authorizes their use for classroom purposes with the provision that no commercial use is permitted.

[Frank Snyder]

September 6, 2006 in Famous Cases | Permalink | TrackBack (0)

Contracts Prof Weekly Spotlight: Michael Satz

Spotlight_2_6_4_2 Michael Satz (University of Idaho College of Law)
B.A., B.S., Southern Methodist University
J.D., University of Michigan

Michael_satz_2 Michael Satz recently joined the law faculty at the University of Idaho College of Law as an associate professor.  At Idaho, he teaches Contracts, Secured Transactions and Creditor's Rights. 

Professor Satz received a B.A. and B.S. from Southern Methodist University in 1990.  After that, he was a Surface Warfare Officer in the United States Navy, completing two overseas tours of duty in Japan onboard the Amphibious Assault Ships USS San Bernardino (LST-1189) and USS Dubuque (LPD-8). Professor Satz then attended The University of Michigan School of Law, earning his J.D. Cum Laude in 2000. While at Michigan, Professor Satz was an Executive Editor on the Michigan Law Review.

Professor Satz has practiced in both the commercial litigation area and as in-house counsel at a major Japanese auto company. One of the perks of his in-house counsel job was free company cars for all counsel. Professor Satz has made it his mission in life to petition the AALS to encourage member schools to provide free vehicles for all faculty members. “It’s a great perk” says Professor Satz, “and it will go a long way in bridging the generational gap between the professors and the students. For example, can you imagine how much more respect the stodgy Contracts professor will garner from the 1L class when he comes spinning into the parking lot in a shiny new sports car, does a donut skidding directly into a parking spot in reverse, hops out and immediately starts lecturing about the Objective Theory of Contract?” Thus far, the response to Professor Satz’ suggestion from the Torts contingent on the faculty at his law school has been lukewarm, but Professor Satz says “they seem to be coming around, especially when you tell them about all the innovations in safety equipment in new cars today, such as ABS brakes and smart airbags. If I can persuade the auto manufactures to put 1L sensing technology into new cars, we may just get there.”

September 6, 2006 in Contracts Profs Weekly Spotlight | Permalink | TrackBack (0)

Tuesday, September 5, 2006

Visual Aides: Smith v. Boyd and Leonard v. Pepsico

If you teach with Smith v. Boyd, 553 A.2d 131 (1989), you might find this Google Earth image of the property useful (click on the image for a larger view):

Smithvboyd

It really doesn't add anything analytically, but it is a fun visual aide.

Also, if you are teaching with Leonard v. Pepsico, 88 F.Supp. 2d 116 (1999), here are links to the commercials.

[Meredith R. Miller]

September 5, 2006 in Teaching | Permalink | TrackBack (0)

Monday, September 4, 2006

Contract: Saved from Death by Consumer Fraud Statute?

The Seventh Circuit (Easterbrook, Rovner, Evans) recently held that a hotel guest's allegation that the hotel's website misrepresented the room rate was not actionable as consumer fraud but, rather, sounded in breach of contract.

Using the hyatt.com website, Britt Shaw made a reservation for a 3-night hotel stay at the Ararat Park Hyatt in Moscow, Russia. The website established a nightly room rate of $502.  However, the website cautioned that the conversion represented an approximate price based on the recent exchange rates, and that "the price paid at the time of hotel checkout will be of the currency initially quoted and displayed."

Shaw stayed at the hotel for three nights and, upon checkout, his bill was provided in Russian rubles. Shaw paid the bill using his American Express card, which charged him a roughly 3182 rubles for the room, taxes, and other amenities. Shaw’s hotel bill reflected a hotel exchange rate of 32 Russian rubles per United States dollar, whereas the official exchange rate set by the Central Bank of Russia on the date of check-out was 28.01 Russian rubles per dollar. The result: Shaw paid approximately 14% more for his room in U.S. dollars than the rate promised by the website.

Shaw pursued a class action against Hyatt, alleging unjust enrichment and violation of the Illinois Consumer Fraud Act.*  Shaw did not allege breach of contract, maintaining throughout the proceedings that there was no contract between him and Hyatt.  The trial court granted Hyatt's motion to dismiss both claims, and the Seventh Circuit affirmed.

The Seventh Circuit held that there was an express contract between Shaw and Hyatt, and that ultimately resolved both of his claims.  The court held that a breach of a contractual promise, without more, is not actionable under the Consumer Fraud Act.The court wrote:

What plaintiff calls "consumer fraud" or "deception" is simply defendants' failure to fulfill their contractual obligations. Were our courts to accept plaintiff's assertion that promises that go unfulfilled are actionable under the Consumer Fraud Act, consumer plaintiffs could convert any suit for breach of contract into a consumer fraud action. However, it is settled that the Consumer Fraud Act was not intended to apply to every contract dispute or to supplement every breach of contract claim with a redundant remedy. [citation omitted] We believe that a "deceptive act or practice" involves more than the mere fact that a defendant promised something and then failed to do it. That type of "misrepresentation" occurs every time a defendant breaches a contract.

Here's a link to the oral argument, with an enlightening set of questioning concerning why Plaintiff did not allege that Hyatt.com breached an express contract to provide the room at the rate promised on the website.

[*Apparently, the website specified that any disputes would be governed by Illinois law.  Shaw booked the Moscow hotel room while on the internet in London; the parties disputed whether Shaw had established the requisite nexus of contact with Illinois to form a basis for the application of the Consumer Fraud Act to the transaction.]

Shaw v. Hyatt Int'l Corp, __ F.3d __, 2006 WL 2473417 (7th Cir. Aug. 30, 2006). 

[Meredith R. Miller]

September 4, 2006 in E-commerce, Recent Cases | Permalink | TrackBack (0)

Weekly Top Ten

Ssrn_logo_65 The top three slots remain the same in the Weekly Top 10, but a new paper from Barak Richman and Jeffrey Macher debuts with a bullet in the fourth slot.  Following are the top ten most-downloaded new papers from the SSRN Journal of Contract and Commercial Law for the 60 days ending Sunday, September 3, 2006.  (Last week's ranking in parentheses.)

1 (1) Technoconsen(t)sus, Andrea M. Matwyshyn (Florida).

2 (2) The Law and Economics of Contracts, Avery W. Katz (Columbia), Benjamin E. Hermalin (Cal Berkeley-Economics) & Richard Craswell (Stanford).

3 (3) Terms of Use, Mark A. Lemley (Stanford).

4 (-) Transaction Cost Economics: An Assessment of Empirical Research in the Social Sciences, Barak D. Richman (Duke) & Jeffrey Macher (Georgetown-Business).

5 (4) Rise of the Financial Advisers: An Empirical Study of the Division of Professional Fees in Large Bankruptcies, Lynn M. LoPucki & Joseph W. Doherty (UCLA).

6 (7) The Strange Death of Academic Commercial Law, Larry T. Garvin (Ohio State).

7 (8) Bankruptcy, Creditor Protection and Debt Contracts, Stefano Rossi & Nicola Gennaioli (Stockholm-Economics).

8 (5) A Coasean Analysis of Marketing, Eric Goldman (Santa Clara).

9 (6) Between Rights and Contract: Arbitration Agreements and Non-Compete Covenants as a Hybrid Form of Employment Law, Cynthia L. Estlund (NYU).

10 (-) The Use of MTAs to Control Commercialization of Stem Cell Diagnostics and Therapeutics. Sean M. O'Connor (U Washington).

[Frank Snyder]

September 4, 2006 in Recent Scholarship | Permalink | TrackBack (0)