Friday, August 26, 2016
I have witnessed with interest the evolving story of what exactly happened in Rio involving Ryan Lochte the morning of August 14. Initially Lochte claimed he had been robbed at gunpoint. I later heard through the gossip mill that that story was untrue and that Lochte had in fact beat up some security guards. That turned out, it seems, just to be rumor-mongering, but the story has continued to evolve from there, with both Lochte and the Rio police making statements that later seem untrue, or only partially true, or exaggerated. Slate has a good run-down of the changing versions of Lochte's story, although it's from a week ago. Now Lochte has been charged with filing a false police report, since it does seem clear at this point that no robbery happened. Even that, however, is confusing to parse if you read a lot of articles about it: It seems like the crime is more accurately making a false communication to police, as some articles have eventually stated, since there are conflicting reports about whether a police report was ever filed.
In the wake of this whole mess, Lochte has lost several of his sponsorship deals (although he's also picked one up). It's unclear, because the contracts don't seem to be public, whether this is a choice of just not renewing the contract (apparently that's the case with Ralph Lauren) or if a violation of a morals clause is being invoked to allow cancellation of the contract (which might be what's going on with Speedo). All of this provokes an interesting morals-clause conversation to me, and we had a bit of discussion about it on the Contracts Professors listserv. It seems clear that Lochte engaged in some sort of inappropriate behavior, and it seems also clear that whatever that behavior was, even the most minor version of the story is arguably a violation of any morals clause out there.
What is most clear is that, no matter what really happened, this has definitely served to tarnish his reputation, and that's is what's striking to me. This story has taken on an enormous life of its own, with many differing versions of it floating around the Internet. This situation has been caused, of course, by Lochte's many differing stories, together with some apparent conflicting statements by the Rio police, coupled with reporting that may have been less than precise itself in describing what was going on. One online story details all the conflicting information and asks the individual reader what they believe about the story.
While this particular maelstrom seems to have some basis in fact, it's not difficult to imagine something like this getting out of control without such justifying behavior at the root of it. Morals clauses tend to be about perception, but does that mean you can manipulate the perception of someone, through no real fault of their own? Take, for instance, the "Ted Cruz is the Zodiac Killer" meme that was popular on the Internet earlier this year. Ted Cruz wasn't born until after some of the Zodiac killings had happened, so he obviously could not have been the Zodiac Killer, and in fact some people interviewed about the meme noted that was the point: what they were saying was impossible. Nevertheless, it was reported that polls indicated 38% of those surveyed thought he might, in fact, be the Zodiac Killer, despite the impossibility. If a substantial number of people start thinking you did something you absolutely did not do, is that enough for a morals clause to be violated, because of the perception that you did it?
Tuesday, July 5, 2016
Everyone else is talking about Donald Trump, so I guess why shouldn't we hop in, right?
This recent New Yorker Talk of the Town piece introduced me to an ongoing contract dispute involving Trump that I hadn't been paying attention to, even though now I see it's been widely reported by various news outlets, including food blogs, because it involves restaurants. So if you don't normally like to read political stuff but you consider yourself a foodie, this blog entry is also for you!
It turns out that Trump is embroiled in breach of contract lawsuits with a couple of famous chefs who pulled out of commitments to put restaurants into one of Trump's new developments. According to the reports, the impetus for pulling out of the business deal was Trump's anti-immigrant rhetoric during his presidential campaign. Jose Andres, himself an immigrant, was not too happy about Trump's statements. As seems to be the case with Trump, his business concerns don't necessarily track his political rhetoric when the bottom line is at issue. Faced with an immigrant refusing him rather than the other way around, Trump sued Andres for breach of contract. Andres counter-sued, alleging that Trump's many derogatory remarks about Hispanics rendered Andres's proposed Spanish restaurant "extraordinarily risky."
The chefs sought partial summary judgment, which a court recently denied, finding that material facts were still in dispute.
The crux of this lawsuit revolves around the covenant of good faith and fair dealing: Did Trump breach that covenant when he made his remarks, which would make him the one in breach of contract? Or were Trump's remarks not a breach of the covenant, either because they're not relevant to the contract or because they did not harm the prospects for success of Andres's restaurant? I don't know if the parties will continue to litigate this question but I'm curious what the result would be. In the current climate where rhetoric is frequently extremely inflammatory, could there be contract implications to such statements? How far, policy-wise, do we want the covenant of good faith and fair dealing to extend?
The case is Trump Old Post Office LLC v. Topo Atrio LLC, 2015 CA 006624 B (behind paywall), in District of Columbia Superior Court.
Friday, April 15, 2016
(image from IMDB)
Gilmore Girls fandom rejoiced when it was announced that the show would receive a revival on Netflix (and, even better, that it will include Sookie!). But, as often seems to be the case, developments that bring a fandom joy can come with legal entanglements. In this case, producer Gavin Polone's production company Hofflund/Polone has filed a lawsuit against Warner Bros., alleging breach of contract. The lawsuit, Hofflund/Polone v. Warner Bros. Television, Case No. BC616555 (behind paywall), was filed in the Los Angeles County, Central District, Superior Court of California.
The case revolves around the agreement between the parties concerning the original production of Gilmore Girls. The parties agreed, according to Hofflund/Polone, to provide Hofflund/Polone with "$32,500 for each original episode of Gilmore Girls produced in any year subsequent to 2003," along with some percentage of the gross and with "executive producer" credit. With the news of the recent Netflix revival, Hofflund/Polone allegedly reached out to Warner Bros. seeking compensation under the agreement. According to the complaint, Warner Bros. took the position that the Netflix version of Gilmore Girls is a derivative work based on the original series, and so therefore does not trigger compensation to Hofflund/Polone.
It's an interesting question that highlights one of the debates copyright scholars have: What, exactly, is a "derivative" work? Copyright owners have the exclusive right to reproduce their own works or works substantially similar to those works. They also have the right to produce derivative works based on those works, which, in the jurisprudence, has ended up using the same substantially similar standard to elucidate the "based on" language. Which means: what is the point of the derivative work right, if its standard seems the same as the reproduction right? This case has the potential to force confrontation with that problem: Where do we draw the line between infringement of the reproduction right and infringement of the derivative work right? When does a substantially similar work cross the line between reproduction and derivative work?
One thing that's been noted about the derivative work right is it tends to be talked about when there's some kind of change in medium or other kind of adaptation different from the original form (book to film, or translation from one language to another). The definition in the statute points us to that focus. Which raises the question: Is a Netflix revival more like a translation or adaptation of Gilmore Girls than it is like an exact copy of Gilmore Girls? Does this depend on how true it is to the original show?
The "television" landscape has shifted dramatically since Gilmore Girls premiered. It'll be interesting to see how contracts formed pre-Netflix-and-Amazon-production-era function going forward.
Thursday, April 7, 2016
Bill Cosby has filed a lawsuit against a woman who settled a civil sexual abuse case against him for allegedly breaching a confidentiality clause in the settlement. That confidentiality clause allegedly barred the woman from voluntarily discussing the case with law enforcement agencies. She has cooperated with police after the criminal case against Cosby was opened. Cosby wants the settlement money paid by him repaid.
Just as you think this case could not sink any lower….
Friday, March 11, 2016
If a recording artist enters into a personal services agreement with a record company that, among other things, contains a promise that the artist will “look solely to [a corporate version of the music band] for the payment of my fees and/or royalties … and will not assert any claim in this regard against [the record company],” has the artist then waived his/her right to sue under the contract if the band’s corporated version does not do so? Probably not, according to the Ninth Circuit Court of Appeals. At least this is a factual inquiry that cannot be resolved on a 12(b)(6) motion. The case is Dale Bozzio v. EMI Group Limited, et al.
In the 1980s, Dale Bozzio was the frontwoman of the band Missing Persons. The band incorporated as “Missing Persons, Inc.,” as is normal in the entertainment industry, so that any contracts with entertainment companies would be signed by one legal entity and not all the individual band members. The corporation, however, was suspended under California law. Bozzio recently sued Capital Records for royalties that she believed were still owed to her notwithstanding the suspension issue. Capitol Records argued that Bozzio waived any right to sue Capitol – including the right to sue as a third-party beneficiary – by signing the “look solely to” artist declaration mentioned above. This in spite of other contract clauses stating, for example, that if the band corporation should case to exist, the individual artists would assume the corporation’s contractual obligations. The contract also stated that Capitol Records had agreed to “pay Artist all royalties and advances required to be paid….” Bozzio argued that the “look solely to” clause was intended to prohibit an artist from asserting a claim against Capital Records only in cases of a dispute among individual band members over the internal allocation and distribution of royalties that have already been paid for by the record label.”
The court found that nothing in the record foreclosed this latter argument and that the issue should be resolved by a trier of facts. Under California law, third-party beneficiaries to a contract “made expressly for the benefit of a third party, may be enforced by him[/her] at any time before the parties thereto rescinded it.” This quite clearly seems to cover Bozzio’s case. The argument that artists should look to their own companies for royalty payments from the entertainment companies with which they have “signed” is not only highly circular, it also flies in the face of logic. This again goes to show the craftiness of litigating attorneys and their client’s willingness to try almost anything to win a case whether warranted or not.
Monday, November 9, 2015
California takes its laws against minors contracting seriously. Very seriously. Dancing with the Stars favorite Bindi Irwin, daughter of “Crocodile Hunter” Steve Irwin, must prove that her father was really killed in 2006 in order for her to get the earnings from the popular dancing show. So far, Bindi Irwin has allegedly presented “insufficient proof” that her father has waived those earnings. This despite worldwide shock that the beloved wildlife TV show stars was killed in a freak accident by a stingray in 2006.
California law requires underage entertainers to get court approval of their contracts to avoid the rampant abuses of minors in the industry of yesteryear. Parents of minors must now sign a quitclaim waiving any rights to the child's earnings. Bindi's mother, Teri, has already signed, but Steve has not, for obvious reasons.
The show’s owners, BBC Worldwide, is working with the court to work out the situation.
Under her contract with BBC, Bindi earns a guaranteed salary of $125,000 as well as weekly sweeteners for each week she stays on the show. So far, Bindi has done very well, even earning top scores one week. The shows airs on Monday nights on ABC.
Tuesday, October 6, 2015
In California (where else?), a state court judge has, for now, refused to dismiss a fraud claim against Mark Zuckerberg of Facebook fame. A breach of contract claim is also still under consideration.
What is the latter all about? As we wrote here earlier, one of Zuckerberg's former neighbors alleges that he promised to sell property adjoining Zuckerberg's at a discount in return for Zuckerberg's promise to provide the neighbor with "personal referrals and business promotion activities." The property changed hands, but Zuckerberg allegedly failed to make good on his promises.
Is he contractually bound to do so? I don't see why not. The promise is not illusory, and although it is not directly monetary in nature, it does seem to constitute true consideration (Zuckerberg would give up time and effort to get the discount and run the risk of inconveniencing his connections).
Of course, promises such as these are probably very hard to enforce via court action. What would a court realistically do? Force Zuckerberg to help the former neighbor hobnob now that the parties undoubtedly dislike each other intensely? Require him to host a certain number of cocktail parties and invite the ex-neigbor? Such relief is unrealistic, just as it would likely be next to impossible to monetize the alleged loss here.
The temptation to contract in part in return for return benefits from the rich and famous is continually present now as it has been for decades, if not centuries. But numerous cases show how such deals are next to impossible to enforce, contracts law principles or not. A higher sales price would undoubtedly have been smarter here.
Making the case even weirder, the neighbor's attorney has petitioned the court to withdraw from the case for ethical reasons.
Sunday, September 6, 2015
The recent massive hack into married-but-dating website Ashley Madison’s files may not only have breached the customer’s reasonable contractual expectations, but is now also said to lead to serious counter-intelligence concerns.
Both China and Russia are collecting personal and sensitive information about people who may be involved in American national security operations. What better leverage to have against operatives than information about their most secret, erotic desires. The temptation to resist such information being shared with even more people may persuade some operatives to render otherwise secret information about United States national security issues. Recall that quite a few affair seekers used their official government addresses to arrange their attempted or successful trysts. In combination with another recent OPM hack, countries that are seen as adversaries have apparently also been able to obtain information about who has sought security clearances and can use this information for counter-intelligence purposes.
That seems to provide a good public policy argument for why courts should find against Ashley Madison if it came to a contractual lawsuit regarding the breach of “100% secrecy” and “full deletes” promised, but not delivered, by Ashley Madison.
Friday, August 28, 2015
In breaking Bieber news, HuffPo reports that Justin Bieber (pictured, left) claimed breach of contract in canceling a scheduled appearance in Montreal. The venue where Bieber was scheduled to perform seems to belieber the young artist, as it posted on its Facebook page a notice that neither it nor Mr. Bieber were liable for the cancellation. Bieber himself tweeted the cancellation, specifically referring to the promoter's breach (and to lying, but we prefer the legal jargon).
In Presidential candidate news, the Wisconsin Gazette reported that Wisconsin taxpayers might have to pay $50 million in damages because Governor Scott Walker (pictured, right) breached a contract that his predecessor had entered into to modernize the states rail service. According to the Gazette, Spanish train-maker Talgo sued the state for $66 million. The case settled, with the state agreement to pay nearly $10 million on top of the $42 million it had already paid for trains that it never received.
The Washington Post reports that a Maryland firm, CNSI, that lost a $200 million contract when its Senior Vice President blew the whistle on irregularities in the award of the contract. CNSI won a contract to process medicaid claims for the state of Louisiana while one of its former executives was Louisiana's Secretary of the Department of Health and Hospitals. The contract was cancelled in 2013 and the Secretary of the Department of Health and Hospitals has been indicted for perjury. CNSI claims that the whistle blower was a disgruntled employee who breached his contract and tortiously interfered. An investigation into possible wrongdoing by CNSI in connection with the contract is ongoing.
Monday, August 17, 2015
I often begin my course by telling students that contracts facilitate mutually beneficial transactions. So, if they want to be the kind of attorneys who make the world a better place, transactional work is the place to be. But sometimes one-sided contracts drawn up in a context of vastly unequal bargaining power can prevent mutually beneficial transactions from taking place. This seems to be occurring in the case of Nick Symmonds, a six-time U.S. outdoor champion at 800 meters who won a silver medal at the 2013 World Championships. According to this story in the New York Times, Symmonds has been left off the U.S. team for the 2015 Worlds taking place later this month because he refused to sign a contract.
Symmonds refused to sign a vaguely-worded document that seemed to require that athletes wear Nike gear exclusively, even in their free time. Nike, according to the Times, has committed to sponsoring U.S. Track & Field to the tune of $20 million per year through 2040. But that contract might interfere with Symmonds' contractual obligations with his own sponsor, the running-shoe company, Brooks. According to the Times, athletes were instructed to pack only Nike-branded or non-branded apparel for the World Championships. Symmonds points out that Brooks is paying for him to wear its brand at important events. If he is prohibited from doing so, why would Brooks continue to sponsor him. Symmonds is all for the Stars and Stripes, but he also has to worry about dollars and cents. He estimates that 75% of his income comes through sponsorships.
Symmonds does not object to wearing Nike apparel at official events. He objects to the vague language that seems to preclude him from supporting his sponsor when he is not at official events. Some are saying that Symmonds is taking this position because he has no chance to medal at the Worlds anyway, so he has nothing to lose. The photo above shows him winning the US championships in 2010. He won again in 2015. If that guy has no chance, what does it say about the rest of the team?
Wednesday, August 5, 2015
Yesterday's New York Times included a report on the odd case of Jason Pierre-Paul (pictured), a New York Giants lineman who injured himself in a fireworks accident last month. The injury came while Pierre-Paul and the Giants were negotiating his contract, and right now the player is in a contractual limbo. The Giants named Pierre-Paul as a "franchise player" and offered him a one-year $14.8 million contract. Pierre-Paul refused that offer, holding out for a multi-year deal.
Pierre-Paul is part of the team but he currently has no contract and thus can refuse to allow visits from team doctors. Apparently, he has elected to do so, and so the Giants do not know the extent of his injury or how it will affect his play. The Times reports that Pierre-Paul had to have his right finger amputated and that there was other damage to his hand, but that is all we and presumably all the Giants know for now. There seems to be a lot of brinksmanship involved, but it also seems likely that in the end, Pierre-Paul will accept the one-year deal. The Giants may then invoke their right to dock Pierre-Paul's pay if he misses games due to "non-football injury."
The Times speculates that Pierre-Paul may be holding out so that he has time to recover and avoid a loss of pay. I'm not sure how that works. What if he misses practices (training camp has already begun)? Why would the Giants agree to his return before they have been permitted to thoroughly test his playing ability? One answer is that Pierre-Paul would then become a free agent who could jump to a rival. Perhaps a realistic possibility, but the Times also notes that Pierre-Paul has underperformed in two of the last three seasons. NFL football is a high-risk game.
Monday, August 3, 2015
In the continuing fallout from Donald Trump's Presidential candidacy (photo right by Michael Vadon via Wikimedia Commons), Trump is now suing celebrity chef Jose Andres. According to the Washington Times, Andres was to open a restaurant in Washington, DC's old post office building, which will soon be the Trump International Hotel. He now claims that Trump's anti-immigrant comments make it impossible for him to do so. It seems that Trump's attorneys' response is to claim that his views on immigration were well known and consistent and should not have come as a surprise to Mr. Andres. The lawsuit seeks $10 million in damages.
In other Presidential candidate news, three unions representing New Jersey public employees are suing the state for breach of contract. The suit arises out of Governor Chris Christie's efforts to address a budget shortfall by cutting contributions to the state pension fund. Excellent coverage of this suit and its background can be found in the Winnipeg Free Press here.
The Fay Observer reports that Intersal, a company that discovered the wreck of Blackbeard's ship of the coast of North Carolina, is suing North Carolina. The suit alleges that the state has breached a contract pertaining to the use photos and video relating to the wreck and seeks $8.2 million in damages.
Thursday, July 30, 2015
I earlier blogged on an American TV personality's contract to hunt and kill one of the most highly endangered species on earth: a black rhino. That hunt has now been completed at a price tag of $350,000. The asserted reasoning for wanting to undertake the hunt: the money would allegedly help the species conservation overall and the local population. Studies, however, show that only 3-5% of that money goes to the local population. Some experts believe that the money could be much better spent for both the local population and the species via, for example, tourism to see the animals alive. This brings in three to fifteen times of what is created through so-called "trophy hunting."
This past week, the world community was again outraged over yet another American's hunt - this time through a contract with a local rancher and professional assistant hunter - of Cecil the Lion. The price? A mere $50,000 or so. This case has criminal aspects as well since the landowner involved did not have a permit to kill a lion. The hunter previously served a year of probation over false statements made in connection with his hunting methods: bow and arrow.
This is also how the locally famous and collared Cecil - a study subject of Oxford University - was initially hunted down, lured by bait on a car to leave a local national park, shot, but not killed, by Minnesota dentist Walter Palmer, and eventually shot with a gun no less than 40 hours after being wounded by Palmer.
Comments by famous and regular people alike have been posted widely since then. For example, said Sharon Osbourne: ""I hope that #WalterPalmer loses his home, his practice & his money. He has already lost his soul."
I recognize that some people - including some experts - argue for the continued allowance of this kind of hunting. Others believe it is a very bad idea for many biological, criminal, ethical, and other reasons to allow this practice. If you are interested in signing a petition to Zimbabwe Robert Mugabe to stop issuing hunting permits to kill endangered animals, click here. It will take you less than 60 seconds.
Monday, July 13, 2015
We have some news from the world of hockey, that is, the sport of the 2015 Stanley Cup Champion Chicago Blackhawks (logo pictured). While elite teams (like the Blackhawks) struggle to keep their rosters under the salary camp (Goodbye Patrick Sharp; Goodbye Brandon Saad -- thanks for the memories and the Cups!), as reported on ESPN.com, the L.A. Kings used an alleged "material" breach of contract to terminate center Mike Richards rather than buying him out to evade the cap. The alleged material breach was at first mysterious, but it has now bee reported, e.g., here on Forbes.com, that Richards was detained at the Canadian border in illegal possession of OxyContin. But the Forbes report also indicates that Richards' mere arrest is not grounds for termination, and even if he is convicted, the NHL's drug policy does not call for termination. It calls for substance abuse treatment. Go Blackhawks!
The Bangor Daily News reports that author Tess Gerritsen has dropped her $10 million law suit against Warner Bros. for breach of contract in connection with the film "Gravity." As we reported previously, a District Court in California dismissed her complaint but allowed her twenty days to amend and refile. The complaint is based on a $1 million contract Gerritsen signed in 1999 to sell the book’s feature film rights to a company that was eventually purchased by Warner Bros. Gerritsen has admitted that the film "is not based on" her book, but she asserts that the book clearly inspired the film.
Friday, July 3, 2015
Late night comedians everywhere celebrated when Donald Trump (pictured) announced his candidacy for President. We too are grateful for the blog fodder. Politico reports that the Donald is suing Univision over its decision to withdraw from a five-year $13.5 contract to broadcast the Miss USA and Miss Universe Pageants, which Trump co-owns. As Time Magazine reports here, NBC has also backed out of airing the Miss USA Pageant, and several people involved have also given the Donald their notice. Trump's partners were upset by statements he made as part of his Presidential campaign that disparaged Mexico and Mexicans. Never fear, the pageant will still be broadcast on Reelz (whatever that is).
Meanwhile, London's The Guardian reports that Harvey Keitel is suing E*Trade for withdrawing from a commitment with Keitel to feature him in a series of three commercials for $1.5 million. According to The Guardian, E*Trade really wanted Christopher Walken for the spots. It was willing to settle for Keitel, until Kevin Spacey became available. E*Trade offered Keitel a $150,000 termination fee, but Keitel says that's not enough.
Students are often astonished that major corporations sometimes operate through informal arrangements such as letters of intent. The fact that they do -- and that they can get in trouble by doing so -- is illustrated in Belfast International Airport's (BIA) attempt to enforce a letter agreement with Aer Lingus. As reported by the BBC, BIA read the letter as embodying a ten-year commitment from Aer Lingus to fly out of BIA. The court found that the agreement merely covered pricing should Aer Lingus continue to fly out of BIA for ten years. Aer Lingus decided to switch to Belfast City Airport, claiming that its arrangement with BIA was no longer financially viable.
Monday, April 27, 2015
April is the finest month for a Chicago Cubs fan, because even the Cubs are within a few games of first place in April.
And hope springs anew with each Spring Training This year Cubs fans have extra reason to hope because of young prospect, Kris Bryant. There was only one catch. Bryant did not start the year playing for the Cubs. As reported here in Business Journalism, despite hitting nine home runs in 40 at bats and earning a .425 batting average, Bryant was demoted to the Cubs' Triple-A affiliate for the start of the season. Cubs GM, Theo Epstein, gave Bryant's need to develop his defensive skills as the reason for the demotion, but many believe that the purpose is to delay Bryant's eligibility for arbitration and free-agency. Bryant's ability to avail himself of these mechanisms would kick in 2017 and 2020 respectively if Bryant was on the Cubs' roster to start the season, but they will kick in a year later if Bryant misses the season's first ten games.
Thirteen days into the season, the Cubs brought Bryant up from the minors. Mike Olt and his lifetime .158 batting average kept third base occupied while Bryant was improving his defensive skills.
Monday, February 23, 2015
2012 American Idol winner Phillip Phillips has lodged a “bombshell petition” with the California Labor Commissioner seeking to void contracts that Phillips now finds manipulative, oppressive, and “fatally conflicted.”
Before winning season 11 of “American Idol,” Phillips signed a series of contracts with show producer “19 Entertainment” governing such issues as his management, recording and merchandising activities. These contracts are allegedly very favorable to 19 Entertainment, for example allowing the company as much as a 40% share of any moneys made from endorsements, withholding information from Phillips about aspects of his contractual performance such as the name of his album before it was announced publicly, and requiring Phillips to (once) perform a live show once without compensation. 19 Entertainment has also lined up such gigs for Phillips as performing at a World Series Game, appearing on “Ellen,” the “Today Show,” and “The View.”
It is apparently not unusual for those on successful TV reality shows to renegotiate deals at some point once their career gets underway. Phillips claims that he too frequently requested this, but that 19 Entertainment turned his requests down. Can he really expect them to agree to post-hoc contract modifications?
Very arguably not. Under the notion of a pre-existing legal duty, a party simply cannot expect that the other party to a contract should have to or, much less, should be willing to change the contractually expected exchange of performances. This seems to be especially so in relation to TV reality shows where the entire risk/benefit analysis to the producer is that the “stars” may or may not hit it big. For hopeful stars, the same considerations apply: their contracts may lead them to fame and fortune… or not. That’s the whole idea behind these types of contracts. Of course, if industry practice is to change the contracts along the way and if both parties are willing to do so, they are free to do so. Otherwise, the standards for contractual modifications are probably the same for entertainment stars as for “regular” contractual parties.
Another issue in this case is whether an “agent” is a company or a physical person. Under the California Talent Agencies Act (“TAA”), only licensed “talent agents” can procure employment for clients. Phillips is attempting to apply the TAA to entertainment companies like 19 Entertainment. If Phillips is successful, the ramifications may be significant for the entertainment industry in which companies very often negotiate deals with performers without taking the TAA into account. In Citizens United v. Federal Election Commission, the United States Supreme Court famously gave personal rights to corporations, albeit only in the election context. Time will tell how California looks at the issue of corporate personhood and responsibilities in the entertainment context.
Adjudications under the controversial TAA are notoriously slow and could leave contractual parites in “limbo” for a very long time. Time and patience is not what Hollywood parties are known to have a lot of, so stay tuned for the outcome of this dispute.
Wednesday, February 11, 2015
Friend of the blog, Miriam Cherry (pictured) is quoted in this story about a spat between Facebook CEO Mark Zuckerberg and a former neighbor. The story seems much creepier than the classic icehouse case, Mitchill v. Lath. Here, plaintiff Mircea Voskerician claims he offered to sell his house to Zuckerberg after pointing out to Zuckerberg that Voskerician was planning to build a large house that overlooked Zuckerberg's master bedroom. Voskerician alleges that he sold the property to Zuckerberg at a significant discount in return for an oral promise that Zuckerberg would introduce Voskerician, a real estate developer, to Zuckerberg's Silicon Valley contacts.
Voskerician alleges that Zuckerberg has not honored his end of the deal. Zuckerberg seems to be denying there was any such deal. So the interesting contracts question is whether the parol evidence rule will permit introduction of Voskerician's evidence of the oral promise. Noting that California is quite permissive in the admission of parol evidence, Professor Cherry suggests that Voskerician will be permitted to introduce the evidence.
If the newspaper account cited above is accurate, it is hard to imagine how Zuckerberg's introduction would have helped Mr. Voskerician. It might run something like this: "Hey there, Captain of Virtual Industry! Let me introduce you to this man, here, who was almost my backyard neighbor. He threatened to do a Rear Window number on me unless I bought him out. Would you like to do some business with him?"
Monday, February 9, 2015
According to Randall Roberts in the L.A. Times, a Los Angeles Superior Court jury ruled for the Sylvester Stewart (aka funk legend Sly Stone, at left) in his action against his ex-manager Gerald Goldstein, attorney Glenn Stone and Even St. Productions Ltd. It's the usual story. Sly Stone suffered from drug addiction and ran into hard times when defendants proposed a commercial association in 1989. Stone successfully alleged unjust enrichment and breach of contract, claiming that he never saw the money that the enterprise earned through his music. A jury awarded Stone $5 million. Even St. Productions filed for bankruptcy in 2013, and the other defendants say that they plan to appeal.
According to Fox Connecticut, a fraternity member who was suspended from Quinnipiac University in a hazing incident is suing the university and four of its officers for breach of contract. He alleges that his tuition payment entailed a contractual commitment and that the university did not live up to its end of the bargain because he was not fairly treated. He has other claims against the university sounding in Connecticut's Unfair Trade Practices Statute and in the implied duty of good faith and fair dealing.
And . . . at long last, the Steven Salaita saga has made its way into a complaint. We blogged about this story before here and here and here. His 39-page complaint alleges statutory violations under 42 USC §§ 1983 and 1985, as well as promissory estoppel, breach of contract, tortious interference, and spoilation of evidence.
Monday, December 1, 2014
We start this week with international news: According to a report from Ghanaweb, Ghana is suing Nigeria for breach of a contract to supply natural gas. Under the West African Pipeline Project, Nigeria is to supply Ghana, Togo and Benin with gas, but it has supplied only about 40% of the gas contracted for. While the report is a bit vague, it seems that the agreement at issue has a $20 million liquidated damages clause, which Ghana thinks is far too low and does not provide an adequate incentive for Nigeria to perform.
In music industry news, the Daily Record informs us that songwriter Wendy Starland won a $7.3 million jury verdict against producer Rob Fusari, who had entered into a settlement with Lady Gaga in 2010. Fusari had claimed entitlement to $30.5 million for helping to launch Lady Gaga's career and contributing to her break-out hit album (are they still called that?). We reported about that suit here. Lady Gaga testified at the trial, at which Starland claimed that she and Fusari had a deal for splitting proceeds from Lady Gaga's career.
And yet another non-disparagement case: this one in the context of realtors. San Diego's ABC's affiliate, 10news.com reports that a realtor sought to arbitrate its breach of contract claim against a homeowner who posted a negative review on Yelp. The homeowner claims that the realtor demanded $8000 and the removal of the Yelp review in order to settle the claim. As Nancy Kim has pointed out, California has a law that will go into effect Jan. 1, 2015, such non-disparagement clauses will be unenforceable. There can also be fines of up to $10,000 for contractual provisions that violate the new law.