Friday, July 20, 2012
In his first appearance on ContractsProf blog, Ashton Kutcher was noted for his replacement of Charlie Sheen, famous for violating an alleged morals clause in his contract with the producers of the CBS television series, Two-and-a-Half Men. In this appearance, his company possibly provides a good example of a party seeking reliance damages.
Kutcher's company, Katalyst Media, reportedly had a contract with the California DMV (yes, that DMV) to provide access and content for a reality show about "the variously humorous, emotional, dramatic, moving, humanizing and entertaining situations that arise [at the DMV] on a daily basis." According to the complaint, the DMV later attempted to cancel the arrangement. In addition to other claims, Kutcher claims that the attempted contract cancellation came after his company had spent money in reliance. Specifically, the complaintstates:
"In direct reliance upon DMV's promises and commitments...Plaintiffs entered into an agreement with cable television station TruTV....Also in reliance on DMV's promises and commitments...Plaintiffs spent literally hundreds of thousands of dollars in pre-production for the Series, including with respect to casting, hiring of personnel, preparing budgets, negotiating contracts, and other pre-production activities."
The case is particularly interesting because the facts somewhat parallel those in the case I use to teach reliance, Hollywood Fantasy Corp. v. Gabor. In Gabor, the organizer of fantasy acting camps sued Zsa Zsa Gabor for backing out of one of the camps and allegedly causing all sorts of damages (including, perhaps, the bankrupting of the entire company). The plaintiff, Leonard Saffir, also alleged that he lost anticipated profits from a "bloopers" show he was planning to sell to a television network based on outtakes from the fantasy camps. Although Saffir's damages were too uncertain to recover under a traditional expectation-based lost profits theory, he was able to recoup his expenses (such as brochures, advertisting, etc.) incurred in reliance on Ms. Gabor's promise to appear.
I suppose the modern day equivalent to a bloopers show would be some current reality TV shows, including Kutcher's own prior series, Punk'd. So, from now on, whenever I run across an Ashton Kutcher re-run, I'll automatically think of Leonard Saffir--and reliance.
[Heidi R. Anderson]
Thursday, July 19, 2012
I've just returned from a semester in New Zealand, teaching an advanced contracts course at the beautiful Victoria University of Wellington. One of the best things about teaching at the law school was having David McLauchlan as a colleague. As many contracts profs know, David is an impressive and prolific contracts scholar and a highly respected expert on contract law. Some of his writings can be found here. During my visit, I had the privilege of hearing David present a paper with the intriguing title, “The Contract That Neither Party Intends.” In his paper, he tackles the issues of interpretation and responded to a recent New Zealand case which endorsed our very own Holmes' strict views regarding the objective approach to contract formation and interpretation. Professor McLauchlan offers several compelling reasons why that view should be rejected in favor of (also our very own) Corbin’s less stringent version of objectivity. The paper is a spirited discussion of interpretation issues ("promisee objectivity" v. "detached objectivity" aka "fly on the wall" theory) and discusses cases that are classics in American casebooks (such as the Peerless case) as well as New Zealand and Australian cases that may be unfamiliar to U.S. contracts profs. It goes to show that while contract law may be local, contract law issues are universal.
Tuesday, May 22, 2012
Sir Cosmo Duff-Gordon (pictured), Titanic survivor and husband to Lucy, Lady Duff-Gordon of Wood v. Lady Duff-Gordon fame, was pictured in today's New York Times here. The picture shows Sir Cosmo, along with two British fencing teammates, holding pistols at the 1908 Olympic Games. Inattentive readers might conclude that Sir Cosmo competed in the dueling competition, but as his Wikipedia entry notes, his specialty (Silver Medal, 1906 Olympics) was the épée.
The individual dueling competition was featured only at the 1906 games and as the Times waggishly notes, "none of the duelists was actually shot," which must have been terribly disappointing for the audience. No wonder you couldn't even find the games on cable in 1906. The Times explains that the competitors "shot at a dummy dressed in a frock coat."
Thursday, April 12, 2012
At the Spring Contracts Conference last month, I presented the contracts law portion of my article, Intolerable Abuses: Rendition for Torture and the State Secrets Privilege. That article is now in print, 63 Alabama Law Review 429 (2012), but as the electronic version has not yet appeared on the Law Review website, you can get the draft version (which is substantively the same as the print version) on SSRN.
The portion that I presented at the conference, "The Trouble with Totten" is about an 1875 case brought by the estate of William Lloyd a Civil War spy. As I summarized the case previously:
In Totten, the administrator for the estate of William A. Lloyd brought a claim against the government, seeking to recover for the breach of an espionage contract. He alleged that Lloyd had entered into an agreement with President Abraham Lincoln in which Lloyd infiltrated enemy territory during the Civil War in order to provide the U.S. Government with vital information relating to the military forces and fortifications of the Confederacy. For these services, Lloyd was to be paid $200/month plus expenses. Honest Abe allegedly paid Lloyd only expenses.
Justice Field, writing in 1875, found that the subject matter of the contract was a secret and that both parties must have known at the time of their agreement that their lips would be “for ever sealed respecting the relation of either to the matter.” In order to protect the public interest in having an effective arm of the government that could engage in secret services, the Court ruled that there could be no claim for breach of a secret contract because the existence of the contract was itself a secret that could not be disclosed.
I have subsequently learned more details about Mr. Lloyd's exploits on behalf of President Lincoln (he was Lincoln's personal spy) and about why President Lincoln stiffed him (Lincoln was dead by the time Lloyd returned from his assignment). The source of the information is Douglas E. Markle's book, Spies and Spymasters of the Civil War. The information provided in the book is also available online here. Unfortunately, Mr. Markle's book contains a bibliography but no citation apparatus, so I cannot identify or further explore his sources. A letter to his publisher went unanswered and I have no other contact information for him.
As I would like to pursue the matter further -- I think the case would be a great subject for a Law Story -- I would appreciate any suggestions our readers might offer about how I might get further information about the life of William A. Lloyd, personal spy to Preisdent Lincoln.
Wednesday, April 4, 2012
A few months back, we ran a series of contracts songs YouTube videos created by Professor Richard Craswell. But the market is not saturated. Noting that Professor Craswell has no song about the good ship Peerless, Professor Mark DeAngelis, of the University of Connecticut School of Business (pictured), rushed to fill the gap.
This is a "Law Lessong" - a law lesson in a song - that I wrote to help students consider the issues of mistake in contract formation. This song chronicles the story of the case of Raffles v Wichelhaus: establishing the rule of mutual mistake in contract law.
The Bonnie Ships Peerles
By Mark DeAngelis
Sing Ho! For the mighty Peerless as through the waves she steers
A bonnie name for a bonnie ship that surely has no peer.
Can there be another like her cargo-bound for Britain's shore
On her treacherous journey into contract lore?
In America the cotton states were subject to blockade
For the fate of worldwide commerce other plans had to be made
In the colony of India English merchants solace found
Though treacherous be the journey the Cape round
And the halls of British commerce saw negotiations bold
A hundred and a quarter bales of Surat cotton to be sold
And bound to "arrive ex Peerless" from the port of far Bombay
A cargo of great value to convey
Sing Ho! For the mighty Peerless as she plows the briney main
A gallant bark no match for her we'll likely see again
Her name being inked upon the page had given the call for
Her treacherous journey into contract lore?
In October's balmy weather it was she first set sail
Her hold was brimmed with goods the merchants contracted for sale
And owing to the faithfulness and skill of her fine crew
Along the docks of Liverpool she drew.
The merchant halls received the word she'd arrived from far Bombay
And the buyer with expectancy made haste unto the quay
As the Peerless spilled her cargo down upon the dock below
No cotton would be found to buyer's woe
Sing Ho! For the mighty Peerless as she rolls upon the seas
With sails aloft and Britain bound she harnesses the breeze
But naught one bale of cotton could be found from aft to fore
On her treacherous journey into contract lore.
But lo and hark the Peerless sits embarking for to sail
Holding precious cotton bound up in a hundred and a quarter bales
A fine Bombay December morn saw her mainsail full unfurled
As she sought to journey halfway 'round the world
The Peerless tossed and pitched so hard as 'round the Cape she flew
When another ship was spied and hailed by her intrepid crew
So, now as peers they plowed the swells bound for opposing shores
Peerless once, now peerless nevermore.
And once again in Liverpool the word passed with all speed
The Peerless had arrived and all with business should take heed
And the Seller stood upon the dock full satisfied and bold
As bail on bail poured from the Peerless' hold.
But alas the buyer ne'er appeared, seller's tender was in vain
For the Buyer'd long since covered other cotton for his skeins
The Seller's suit was filed and for contract breach he claimed
And the case went on to earn them legal fame
Sing Ho! For the mighty Peerless now her voyage it is done
Her seafaring o'er but in the law her legacy's begun.
Though the merchants both invoked her name it left the seller sore
O'er her treacherous journey into contract lore.
Peerless? Nay the gallant ship was equaled by one more
For two ships by name "Peerless" sailed the brine to Britain's shore
On the merchants' fateful term to "arrive exl Peerless" they'd agreed
But no contract formed that either one must heed.
The words were fraught with meaning neither party could foresee
That each had meant a different ship to sail the rolling seas
Like two ships passing in the night, each one to the other blind
Though words agreed, no meeting of their minds.
Sing Ho! For the mighty Peerlesses as through the waves they steer
A bonnie name for bonnie ships that surely have no peers.
Can there be another like them cargo-bound for Britain's shores
On their treacherous journey into contract lore?
It's a treacherous journey into contract lore!
Professor DeAngelis's other Law Lessongs can be accessed here.
Monday, March 5, 2012
History Repeats Itself in Ohio: The Kirksey v. Kirksey Tragedy Replayed as the Williams v. Ormsby Farce
Our colleagues on the Contracts Listserv have brought to our attention the very interesting case of Williams v. Ormsby, decided last week in the Supreme Court of Ohio. There has been some suggestion that this is a repeat of the great Kirksey v. Kirksey case. But as William Casto or Val Ricks would have told Amber Williams “I knew Antillico. Antillico was a friend of mine. You, madam, are no Antillico.”
In May 2004, Frederick Ormsby moved in with his on-again off-again girlfriend, appellee, Amber Williams. Subsequently, Ormsby paid off the mortgage and in return, Williams quitclaimed the title to the property. Off again, the couple separated and agreed in March 2005 to sell the house and allocate the proceeds. On again, they attempted to reconcile, but in return for moving back in, Williams demanded an undivided half interest in the property. In June 2005, they signed a second document, ostensibly making them “equal partners” in the house.
By September 2007, the couple was off again, and now they assumed an equal undivided interest in a lawsuit. Williams sought either specific performance of the June 2005 agreement or damages arising from Ormsby’s alleged breach of that agreement. Ormsby alleged causes of action for quiet title and unjust enrichment/quantum meruit and sought declaratory judgment that both the March 2005 and June 2005 documents were invalid for lack of consideration. The trial court ruled in Ormsby’s favor; the Ninth District Court of Appeals reversed, concluding that “moving into a home with another and resuming a relationship can constitute consideration sufficient to support a contract.” The Supreme Court of Ohio accepted jurisdiction to decide whether or not that proposition is in fact good law.
The court of appeals found that the June 2005 agreement was supported by valid consideration because “romantic relationships typically involve some sacrifice by each partner.” The majority on the Ohio Supreme Court disagreed. Unlike Antillico Kirksey, Williams suffered no detriment from the June agreement; she received only a benefit and so the June 2005 offered evidence only of Ormsby’s gratuitous promise to give Williams an interest in the property based solely on the consideration of her love and affection. Such consideration is no consideration, harrumphed the majority.
The record is replete with shadings and innuendo that there was no love and affection between the parties. The record includes statements that suggest or allege that Williams and Ormsby were searching for a way to continue living well without engaging in full-time work, that Williams was seeking to both delude and elude creditors, that Williams’s name may have been fraudulently signed on the quitclaim deed or that the person who notorized her signature did so without being present when Williams signed, that domestic violence charges had been filed, and that each had promised not to accuse the other of domestic violence. That Williams wouldn’t move back into the house until Ormsby signed the agreement, which he wrote, was not offered as consideration and was not consideration. It was a simple fact of life—a fact that is outside the contract and is of no relevance.
Justice Pfeifer points out that identical language concerning consideration was used in both the March and June agreements. If the first is to be enforced, the second should be as well. Moreover, by voiding the March agreement, which entitled her to specific rights, Williams gave valid consideration for the June agreement, which entitled her to different rights. Under the June agreement, Ormsby gained more control over the timing of any sale of the house and in gaining these benefits, forfeited some equity in the house. Justice Pfeifer would have found both agreements enforceable, but since the case is so idiosyncratic as to be useless as a precedent, Justice Pfeifer would have dismissed the case, review having been granted improvidently.
[JT & Christina Phillips, with a hat tip to Catherine Garcia-Feehan, Esq., Career Law Clerk to Hon. David A. Katz at the Northern District of Ohio, through whose good offices this came to the attention of the Contracts Listserv]
Tuesday, February 14, 2012
What better way to spend Valentine's Day than to (almost live) blog the Simkin v. Blank oral argument before the New York Court of Appeals? The argument includes a shout out to Rose of Aberlone.
It does not appear that Judge Smith partook. Video should be posted to the web in the next week.
Richard D. Emery (for Blank, appellant):
[Reserves 3 minutes for rebuttal]
Theme: this case is about finality and valuation.
Judge Pigott: Suppose shoe was on other foot and the non-moneyed spouse was rendered destitute -- finality rules? It depends. Here, parties got the benefit of the bargain.
Judge Jones: Wasn't the agreemet based and founded on certain assumptions that turned out not to be so? All agreements are founded on assumptions that turn out not to be true, that is the risk of making an agreement.
Judge Lippman: Is the defining difference between this and other mutual mistake cases that, here, the mistake was about valuation? Yes, mistaken valuation doesn't give rise to mutual mistake case. In fact, account was cashed in at the time.
Judge Graffeo: Is this about value of account at time of agreement? Wasn’t there some withdrawal at the time in order to pay Blank; money was there at time? Yes, shout out to Prof. Siegel’s treatise; don’t fall for pleading ploys. These are conclusory allegations that mean nothing in the context of the actual case.
Judge Graffeo: Was it agreed that there would be a 50-50 split of this account? If so, does that matter? That was not mentioned in agreement all. Many separation agreements will say 50-50 split per account; different situation here - he could have chosen to do whatever he wanted to pay her here (e.g. take loan from Paul Weiss) and he chose to withdraw from account.
Judge Pigott: Isn’t the existence of the account an issue of fact? Court does not have to rollover and counterfactually accept what is obviously not the case. And, account existed. Just not worth what they thought. There was money in it and money paid out of it. At time, Madoff accounts were paying -- so, counterfactual allegation that court need not accept.
Judge Lippman: What happens now with Madoff accounts? There will be no clawbacks; he did get insurance money and tax write offs. Has value now, had value then. Pure valuation case.
Judge Read: So no mutual mistake here? Right - each side got the benefit of the bargain here. Just a mistake in valuation.
Judge Ciparick: Did the parties contemplate as a 5-50 split? No, my client wanted $6 mill plus house, etc and he got the rest.
Judge Graffeo: How is this different than a case where we set aside the agreement for fraud? This is an asset that is not worth what it was thought to be worth -- your decision in Walsh makes plain that the public policy of repose trumps innocent fraud.
Judge Jones: Different if wife knew of the wrongful valuation? Yes, then she would be knowingly getting fruits of fraud - would be a different case.
Judge Ciparick: Is this different than asset valued at a certain sum that later tanks? No different from every single deal where stocks are exchanged.
Judge Ciparick: Should we go with value of account as of date of agreement? Yes.
Judge Graffeo: What about the unjust enrichment claim? We have a valid contract, unjust enrichment claim is superfluous. Window dressing contract claim to attack a valid agreement.
Allan J. Arffa (for Simkin, respondent):
Judge Lippman: How is this different than a valuation case? Why is this not the same as a stock that turns out the be worth less than thought? The thing they thought they had never existed.
Judge Lippman: But isn’t it in essence the same thing – because, here, there was a Ponzi scheme? No. The account didn’t exist; it wasn't the thing they thought it was.
Judge Lippman: Didn’t Simkin draw on the account at the time? Yes, but they didn't know he was actually drawing on other people's money.
Judge Lippman: How could the account not exist? He withdrew the money? It didn't exist in the way he thought it did.
Judge Lippman: What if had stock and turns out fraud relating to business that stock represents. Why different? There you have stock; known thing was stock, it existed.
Judge Read: What if it was Enron stock? Still had stock in a corporation; it had attributes of stock. Here, interest was fictitious.
Judge Ciparick: What if the asset was a house but it turns out the title was bad? That is mutual mistake - if you don't own what you think you own, there is a mutual mistake.
Judge Lippman: How do we draw the line here – why isn’t this just a valuation case? How do we distinguish between the subject matter existing and it not being worth as much as thought? We are on a motion to dismiss. At the time they contracted, they didn’t own an account; they didn’t have securities; the account was a total fiction.
Judge Graffeo: Did they try to cash out in June 2006? Would they have been paid? Paid from proceeds of other investors. Would not have been redeeming account as they thought = stealing.
Judge Pigott: You argue for reformation of this part of the agreement, not the entire agreement? Issue for down the road; what to reform is a remedy issue.
Judge Graffeo: Where is it in agreement that you agreed to split the asset 50-50? It is our allegation that this is what the parties intended. The parol evidence rule and statute of frauds do not apply. Shout out to Rose of Aberlone: in the pregnant cow case, the contract did not say we are selling you a barren cow.
Judge Graffeo: I’m trying to understand, do you want us to set aside the entire agreement? That is a matter of relief; we can discuss whether to reform or rescind later.
Judge Lippman: What about finality? When does a matrimonial case end? Isn’t there a policy argument for finality? Here's the problem: if you say finality trumps, then there is no mutual mistake -- writes doctrine out of the law.
Judge Lippman: But the divorce was 6 years ago, doesn't amount of time matter? It matters regarding relief.
Judge Lippman: What is rule? 10 or 6 or 20 years? Not one mutual mistake case that raises finality. Depends on circumstances.
Judge Pigott: You win the appeal. They answer. Then what? Jury decides? Yes, jury hears testimony; finality gets played into standards for materiality of mistake.
Judge Lippman: Answer Judge Piggott’s question. What exactly does the jury decide here?
Judge Pigott : Does the jury decide whether there was an ccount or not? Existence v. value of account: question of fact or law? Question of fact; these are question of intent.
Judge Pigott: Can you get there if there was no account? If no account existed, aren’t you entitled to summary judgment? If the account did exist, aren’t they entitled to summary judgment? This was a ponzi scheme.
Judge Lippman: With all the attention on Madoff, etc., a jury is going to determine whether this ponzi scheme made account nonexistent? Yes, for jury to decide.
Judge Lippman: What is the significance of time passing here since divorce? This factors into relief but to say we are going to ignore that there was this massive fraud and half assets of this family turned out not to exist -- not fair. On marital cases, equitable principles may trump finality. And, again, we are just at motion to dismiss stage.
Judge Pigott: Say the asset was gold bars in a safe deposit box and it turns out that Uncle Bernie took them; no longer there? Here, did know account was liquid at time of agreement and even took money out of it. And account has value now; Simkin has recovered some money and has tax write offs. Not so worthless he'd give away now.
Closing point: talking about domestic relations. 6 years since divorce; let spouses go off and live their lives. Human thing; not about finality words; about a woman entangled with a husband she wants to get away from.
Judge Pigott: What if we turn the tables? You'd be arguing the opposite for her? No, my client would not have gone after him; she wants nothing to do with him.
[Meredith R. Miller]
Monday, January 23, 2012
NEW YORK — Macy’s Inc. has sued Martha Stewart Living Omnimedia Inc. in a bid to block a licensing deal between the housewares company and J.C. Penney Co.
The lawsuit was filed Monday in New York State Supreme Court. Macy’s claims Martha Stewart Living’s deal with J.C. Penney violates the terms of an exclusive pact Macy’s has to sell Martha Stewart Living products at its stores, according to reports in The Wall Street Journal and other publications.
The complaint comes after Plano, Tex.-based J.C. Penney acquired a 16.6 percent stake in Martha Stewart Living and announced plans last month to open mini-Martha Stewart shops inside most of its stores, beginning next year. The deal announced last month was seen as part of J.C. Penney’s efforts to re-image itself under its new CEO Ron Johnson, a former Apple Inc. executive.
Cincinnati-based Macy’s has asked the court for a preliminary injunction to block the deal.
Martha Stewart Living said it does not comment on legal matters, but issued a statement saying that it received a notification from Macy’s that it intends to renew and extend its commercial agreement with Martha Stewart Living to feature and promote the Martha Stewart Collection in Macy’s stores.
Waiter, bring us some more Bacardi, we'll order now what they ordered then:
[Meredith R. Miller]
A few years ago, the story of a "blood contract" between two Korean businessmen caught the attention of contracts profs. In that case, one of the men made a promise to the other to repay money -- and made the promise on a cocktail napkin in blood. The court ruled the promise was unenforceable because it lacked consideration. I wrote about the case for the Wake Forest Law review here and last year, the Wake Forest Law Review Online posted responses by Professor Scott Burnham here and Professor David Epstein here. I recently posted a reply to those responses here. Deborah Post, Associate Dean for Academic Affairs and Faculty Development and Professor of Law at Touro Law, has now added her thoughtful perspective to the discussion here.
Friday, January 13, 2012
And here it is: the last in our series of links to Professor Richard Craswell's series of first-year contracts cases put to song. Previous installments in the series from Professor Craswell have included his takes on Frigaliment, Lumley, Wood v. Lady Duff Gordon, Alaska Packers, Parker v. Twentieth Century Fox, and Wartzman v. Hightower Productions.
Boy meets cow. Boy loses cow. Boy files an action in replevin. And now Plymouth (Michigan) takes its rightful place beside Verona (Italy) and the upper West Side (Manhattan) as the home of legendary star-crossed lovers!
Oh, all right. The actual facts of the case are more prosaic. Theodore Sherwood, who wanted to buy the cow, was the 47-year-old PRESIDENT of the local bank, who would never have considered hopping a freight train out of town. Though his motive in purchasing the cow is obscure, there was of course no evidence that his interest in the cow was anything other than financial. And the eventual outcome of the case was far happier than that portrayed here, for the pedigreed cow in question ("Rose the Second of Aberlone") went on to have at least five additional calves, whose registration papers each listed none other than Theodore Sherwood as the breeder. Still, no Hollywood or Nashville producer would have settled for the facts described above. Make the banker a penniless but romantic youth; change his interest in the cow to something more than "just good friends"; then tack on an implausible but heart-wrenching ending (and label the result "inspired by a true story") ... well, do all that, and you might just have the next big musical hit!
The rather long list of poems inspired by Rose of Aberlone begins famously wiith Brainerd Currie, "Aberlone, Rose of (Being an entry for an index)," first published in the Harvard Law School Record, Mar. 4, 1954, p. 3, and stiill widely available on various web sites. See also Alan Garfield, "Basic Assumption: A Poem Based on Sherwood v Walker," 57 SMU L. Rev. 137 (2004); and the various verses that can be found (along with much background on the case itself) in Norman Otto Stockmeyer, "To Err is Human, To Moo Bovine: The Rose of Aberlone Story," 24 T.M. Cooley L Rev 491 (2007).
The whole series can be found here,
Thanks to Professor Craswell for sharing these songs and YouTube creations with us!
Thursday, January 12, 2012
We continue our series of postings of Professor Richard Craswell's contracts songs with this number about "Woody Hightower" and his pole-sitting gambit. Other installments in the series from Professor Craswell have included his takes on Frigaliment, Lumley, Wood v. Lady Duff Gordon, Alaska Packers, and Parker v. Twentieth Century Fox.
Here is Professor Craswell's summary of the case:
Hightower Productions intended to employ a singer-entertainer who would live in a specially constructed mobile flagpole perch and set a new world record for flagpole sitting. The young man selected to perform this feat would be known as "Woody Hightower," and the venture was to be publicized by having him make appearances from his perch at concerts, shopping centers and the like.
Unfortunately, Hightower Productions' lawyer (Mr Wartzman) failed to prepare the paperwork needed for the company to sell stock legally to investors. As a result, no further money could be raised (nor could "Woody" be exhibited across state lines) and the project was abandoned. Unable to prove how much its flagpole-sitting venture might have made if it had gone forward, Hightower Productions instead sued its lawyer for some $170,000 in out-of-pocket expenses, known in contract law as reliance damages.
The whole venture seems a bit daft. In order to defeat the record set by St. Simeon Stylites, "Woody" would have had to sit atop his pole for 37 years. "What?" you say. "That's not what my Guinness Book of World Records says!" Well, Mr. Guinness, meet Mr. Tennyson. Or, if you prefer a more modern take on such religious exercises, consider Joshua Mehigan.
Wednesday, January 11, 2012
Here is the latest from Stanford Law's Professor Richard Craswell. This is his take on Shirley Maclaine's suits against 20th-Century Fox, a case we have previously posted about here and (more briefly) here. Other installments in the series from Professor Craswell have included his takes on Frigaliment, Lumley, Wood v. Lady Duff Gordon, and Alaska Packers.
Professor Craswell provides the following case summary:
In 1965, Twentieth-Century Fox signed Shirley Maclaine Parker to play the lead in a movie based on the Broadway musical, "Bloomer Girl." The contract guaranteed Ms Maclaine at least $750,000; it also gave her approval rights over the movie's director. However, Fox later decided not to produce "Bloomer Girl" ... and then refused to pay Maclaine the guaranteed compensation unless she played the female lead in "Big Country, Big Man", a western set in the opal mines of frontier Australia. This role had no singing or dancing, gave her no control over the director, and was to be filmed on location in Australia.
When Maclaine turned down this role, Fox said they owed her no money because she could have avoided (or "mitigated") any financial losses by appearing in the western. The California Supreme Court famously disagreed, and ordered Fox to pay the $750,000.
For more on the history and context of this case, see Victor P. Goldberg, "Bloomer Girl Revisited, or, How to Frame an Unmade Picture," 1998 Wis. L. Rev. 1051; and Mary Joe Frug, "Re-Reading Contracts: A Feminist Analysis of a Casebook, 34 American U. L. Rev. 1065, 1114-25 (1985).
Monday, January 9, 2012
Continuing our series of posts on Professor Richard Craswell's first-year contracts course in song. Previous installments have included Professor Craswell takes on Frigaliment, Lumley, and Wood v. Lady Duff Gordon. Today, we present this little ditty about Alaska Packers v. Domenico, a case we have posted about previously here and here. Professor Craswell's summar is provided below:
In 1902, some inexperienced sailors (many of them Italian immigrants) signed a contract to work the gill nets in Pyramid Harbor, Alaska, for the Alaskan Packer's Association, a cartel made up of most of Alaska's canneries. The sailors' pay was to be determined partly by the size of their catch, at a rate of 2¢ per fish. When they arrived in Alaska, however, some of the sailors complained that the nets were inadequate and threatened to strike. They returned to work only when the cannery promised them higher wages -- a promise the cannery later refused to keep.
The Goetz & Scott article referred to in the song is Charles J. Goetz & Robert E. Scott, "Principles of Relational Contracts," 67 Va. L. Rev. 1089 (1981). For the history of this case in particular, and of the Alaska canning business generally, see Deborah L. Threedy, "A Fish Story: Alaska Packer's Association v Domenico," 2000 Utah L. Rev. 185 (2000). There is also a well-made video ("Sockeye and the Age of Sail -- The Story of the Alaska Packer's Association") that can be found here:
Friday, January 6, 2012
We have already presented Stanford Law's Richard Craswell's takes on Frigaliment and Lumley. Today, we offer his song about Wood v. Lady Duff Gordon, a case we have previously mentioned, for example here, here, here, here, and here.
Here is Professor Craswell's summary:
Born Lucy Sutherland, she married a Baronet and became one of the first celebrity fashion designers, enjoying success in the UK and France. Her American ventures were less successful, though, especially the effort to sell her designs through Sears and other mass retailers. Among other problems, she had already granted her American marketing rights -- including the right to half of the profits on each sale -- to a publicity agent, Otis Wood.
When Mr Wood sued for the unpaid royalties, Lady Duff-Gordon defended on the ground that Wood had not explicitly PROMISED he would do anything in return, so Duff-Gordon's promise to Wood was unenforceable for lack of "consideration." New York's highest court disagreed, in a famous opinion by Judge Benjamin Cardozo,
For a discussion of the case's historical context, see Victor P. Goldberg, "Reading Wood v Lucy, Lady Duff-Gordon with Help from the Kewpie Dolls," in his book, Framing Contract Law: An Economic Perspective 43 (2006). Other useful discussions can be found in the symposium introduced by James J. Fishman, "The Enduring Legacy of Wood v Lucy, Lady Duff-Gordon," 28 Pace L. Rev. 161 (2008); and in Mary Joe Frug, "Re-Reading Contracts: A Feminist Analysis of a Casebook, 34 American U. L. Rev. 1065 (1985).
And here's the video:
Thursday, January 5, 2012
Here is today's installment of the first-year course set to music by Richard Craswell. This time it's Lumley v. Wagner, Lumley v. Gye, a case we have not spoken about previously on the blog. So here is Professor Craswell's summary of the case:
In 1852, soprano Johanna Wagner (the niece of the famous composer) agreed to perform for three months in London at Her Majesty's Theatre, operated by Benjamin Lumley. The contract, which described her as "cantatrice of the court of His Majesty the King of Prussia," specified that Wagner could not perform at any other London theatre during that time. However, after Lumley failed to pay Wagner the advance that her contract required, Wagner accepted a better-paying engagement at Frederick Gye's Royal Italian Opera Theatre in Covent Garden, London. ¶ Courts then (as now) were reluctant to issue injunctions compelling artistic performances, in part because a coerced performance might not be very good. Lord St Leonard, England's Lord Chancellor, found a solution by ordering Wagner NOT to sing at any OTHER theater during those months. ¶ For more on the history and context of this case, see Lea S. VanderVelde, "The Gendered Origins of the Lumley Doctrine: Binding Men's Consciences and Women's Fidelity," 101 Yale L.J. 775 (1992).
We note that the case is the subject of a recent law article, A New Tortious Interference with Contractual Relations: Gender and Erotic Triangles in Lumley v. Gye, by Sarah Lynnda Swan.
Wednesday, January 4, 2012
Stanford Law's Richard Craswell has shared with us a link to his collection of contracts YouTube videos. But a pig this good you eat one leg at a time. So for now, we just include his song about Frigaliment, Judge Friendly's great chicken coup. It's not like we haven't written about this case before, for example, here, here, here, here and here.
But we never tire of new approaches to the case. Here's Richard Craswell's:
Tuesday, December 6, 2011
Contracts profs love teaching Peevyhouse. We at the blog love Peevyhouse. We have composed songs and poems, we’ve written scholarship about the case. There is even a movie. We just can’t get enough of it. And as if there were not already enough materials available to profs looking to jazz up their Peevyhouse discussion, the New York Times has this big front-page story, which is part of an on-going series of articles, plus the Times has also established an online archive of oil and gas leases.
The Times story relates the experience of Scott Ely and his father, who entered into a lease to allow Cabot Oil and Gas engage in gas drilling on their land. They were left with “toxic drilling sludge stored in large waste ponds” on their property. When the waste seeped out, it contaminated the drinking water on a separate property. Mr. Ely sued. Cabot’s spokesman contends that “the company’s cleanup measures met or exceeded state requirements.”
The Times’ review of 111,000 similar leases suggests that many or most such leases do not provide all of the contractual protections that landowners like the Elys expect.
For more very interesting information on the complications associated with oil and gas exploration in Pennsylvania, we recommend this episode of This American Life.
Wednesday, November 23, 2011
In a characteristically insightful blog post, Dave Hoffman uses Vokes v. Arthur Murray as a nice launching point to discuss some aspects of the scam-critiques aimed at law schools. Vokes is such a great teaching case, and Dave's post leaves me feeling like I could have done a better job teaching it this year.
There's not much to add to the mix in the scamosphere, as many bloggers, including some of our own here at ContractsProf, have already commented very thoughtfully. In my humble opinion, the law school scam coverage is old news often sloppily reported with the vitriol amps turned up higher. And the coverage of these law school scam stories, at the New York Times in particular, seems completely disproportionate to the coverage of the number of other significant things happening in the world. (You really want cynicism? These stories get linked all over and end up on the most read and emailed list on the newspaper's website, driving page views. Page views drive advertising revenue. So, why not write another law-school-is-a-scam article?).
Anyhow, perhaps ironically in light of the recent spate of "scam" coverage about law schools, it seems that the vast majority of my students had very little sympathy for Ms. Vokes.
[Meredith R. Miller]
Tuesday, November 8, 2011
Ever wonder how the facts and primary arguments in Frigaliment, a.k.a. The Chicken Case, could be illustrated via a humorous video clip involving Hitler? Yeah, me neither. Until now.
Last night, a former student of mine sent me a link to a "Hitler Rant" on this very case. For those who, like me, are too old and boring busy to have heard of HItler Rants before, they are an internet meme in which various "authors" craft humorous captions on all sorts of topics and insert them into the same clip from the critically-acclaimed German film, Downfall. For those who, like me, are children of the '80s, think Mad Libs for movie trailers. (Our fearless leader, Jeremy Telman, previously blogged about the phenomenon, and its application to contract doctrine, here.) As you likely recall, in Frigaliment, the core of the dispute was whether an agreement to purchase "chicken" should be interpreted as applying to only "young" chicken or any chicken. As for the Hitler Rant regarding Frigaliment? Well, you just have to see it for yourself.
[Heidi R. Anderson, h/t anonymous student]
Monday, October 31, 2011
The WSJ reports on the volatile cotton market and the record number of contract disputes that have arisen as a result. Here's a sample:
Just how binding is a binding agreement?
In the cotton market, dozens of remorseful buyers are putting that question to the test.
Since they agreed earlier this year to buy thousands of bales of cotton when prices were at record highs, cotton mills have seen prices tumble 54%. So, as delivery time nears and bills come due, some have decided not to pay up.
In a phenomenon that may be unique to the cotton market, contracts are considered by many buyers to be little more than a message of intent, with any agreement up for negotiation. And because the market is so farflung—merchants in the U.S. often trade with thousands of small buyers in Bangladesh or Indonesia—regular legal battles can be costly and lengthy.
Thanks to the wild swings in cotton prices, the industry is facing a record number of contract disputes. The International Cotton Association has received 168 requests for arbitration this year. That is the most since the industry's self regulator starting keeping track in 2000.
This year, it is mostly mills and other buyers backing out, industry officials and traders say. They bought when cotton was as pricey as $2.1515 a pound, the record hit in March. On Monday, cotton for December delivery rose 0.9% to close at 97.94 cents a pound on ICE Futures U.S.
Shrugging off those contractual obligations has made cotton prices jumpy. Having backed out of deals struck in the futures market, buyers have gone into the spot, or cash, market to get what they needed to spin thread for T-shirts, underwear and the like. Those reverberations have been felt by clothing makers of all sizes, whose margins were squeezed by the run-up in prices and now have to decide whether they can lower prices ahead of the holiday season.
"Both the textile mills [and] the merchant...have had a great deal of trouble in managing their risk," said Joe Nicosia, chief executive of Allenberg Cotton Co., the cotton arm of French trading house Louis Dreyfus Group, during an industry conference call in July.
When mills don't live up to their end of the deal, cotton merchants, including big, multinational commodity-trading firms, are at times left holding the bag.
Each year, 100,000 to 200,000 cotton contracts are signed, said Terry Townsend, executive director of the International Cotton Advisory Committee, a group that advises cotton-growing nations. For the crop year that ended July 31, about 10% of contracts have been defaulted on, said Mr. Townsend.
Defaults are a fixture in the cotton market.
You mean the buyer and seller didn't agree to shipment of the cotton on the Peerless?
For more (including a snazzy graphic with data), scale the WSJ paywall and read the article. As one commenter wrote: "A deal's a deal until a better deal comes along."
[Meredith R. Miller]