ContractsProf Blog

Editor: Jeremy Telman
Oklahoma City University
School of Law

Friday, February 23, 2024

Friday Frivolity: Offer to Enter into a Unilateral Contract from John Oliver

John_Oliver_November_2016
Image by Neil Grabowsky / Montclair Film Festival, CC BY 2.0 via Wikimedia Commons

Offers to enter into unilateral contracts provide frequent blog fodder.  Elon Musk offered Wikipedia $1 billion if it would change its name.  He did something similar, offering to pay legal fees for people who faced adverse employment decisions for posts on Twitter.  James Corden gave us food for thought here.  Celebrities offer very high rewards for the return of their lost or stolen pets. Burma Shave offered a trip to Mars.  In all of these cases, the offeror seems to have made the offer for non-contractual reasons.  They never intended to make good on their offer.  They were just trying to make some point unrelated to mutually beneficial transactions. 

John Oliver (left) seems to be doing something very different. On his show last week, John Oliver produced a document that he described as "a contract," in which he, in his personal capacity, offered to pay Justice Clarence Thomas $1 million/year for the rest of his (or John's ) life if Justice Thomas would agree to step down from the U.S. Supreme Court.  To sweeten the deal, John also threw in a luxury motor coach worth $2.4 million.  He gave Justice Thomas thirty days to accept the offer.  He said repeatedly that his was a serious offer, and I think he meant it.

Unlike other unilateral offers discussed in this space, John Oliver's offer seems genuine.  He seems like he actually wants Justice Thomas to take the offer.  Paying Justice Thomas $1 million a year might be painful for John, but I suspect he will make it back by having cemented his reputation for the rest of his life as a legend of political comedy.

February 23, 2024 in About this Blog, Celebrity Contracts, Television | Permalink | Comments (3)

Thursday, February 22, 2024

Gina Carano Strikes Back!

Gina_Carano_by_Gage_Skidmore
Image by Gage Skidmore
CC BY-SA 3.0

This case was brought to my attention by our blog's Founder and Editor Emeritus Frank Snyder.  He posted a link to the case on the AALS Listserv for contracts professors, and discussion ensued.  I acknowledge that what follows is indebted to that discussion, and I thank my colleagues for alerting me to the issues raised in the litigation.  

ADDENDUM:  Just learned via Riddhi Setty writing on Bloomberg.com that Gina Carano's suit is being funded by Elon Musk.  This makes sense, given Mr. Musk's earlier offer to pay the legal bills of anyone who claims that they were unfairly treated by an employer due to Twitter posts.  Musk v. Disney seems like a good match-up.

On February 6th, mixed martial arts fighter, actor, and professional bad-ass Gina Carano (Ms. Carano, right) filed her complaint against The Disney Company (Disney) and others.  The case is of interest not only because of Ms. Carano's success in her role in the Star Wars/Disney series, The Mandalorian, among other boundary-breaking performances, but also because of the interesting legal issues raised by her complaint.

The Complaint alleges that Disney wrongfully terminated Ms. Carano based on the political content of her social media posts made while away from work.  She further alleges that Disney discriminated against her as a woman, as men who posted similar things on social media did not suffer the same adverse employment decisions.

According to the Complaint, Ms. Carano's character, Cara Dune, was a key element in the success of The Mandalorian.  Undoubtedly, she had more rizz than the faceless protagonist, but nobody on that show could compete with the adorable muppet, Grogu, known to fans as "Baby Yoda" (below left).  She was paid only the applicable minimum salary of $25,000 per episode.  Late in 2020, Jon Favreau, who created The Mandalorian, allegedly represented to Ms. Carano that she would be featured in a new spinoff series, for which her compensation would increase as much as tenfold.

Then, in February 2021, Defendant Lucasfilm made the following announcement:

Gina Carano is not currently employed by Lucasfilm and there are no plans for her to be in the future. Nevertheless, her social media posts denigrating people based on their cultural and religious identities are abhorrent and unacceptable.

Carano characterizes this and other statements by defendants as calculated, malicious, false, and knowingly in violation of California statutes that protect employees from persecution for their political beliefs.  She alleges that, based on such false allegations, Disney not only terminated her but also refused to hire her for additional projects. 

Grogu Issues:

Was Ms. Carano an Employee?

Ms. Carano's first cause of action is for wrongful discharge under California Labor Code §§ 1101, et seq, which prohibits employers from "[c]ontrolling or directing, or tending to control or direct the political activities or affiliations of employees."  One issue that may arise in the case is whether she comes within the ambit of the statute.  She may have not have been an employee at the time that Disney announced that her "termination."  After all, according to the Complaint , in announcing Ms. Carano's termination, defendant Lucasfilm said that she was not "currently employed." 

While her employment status might be relevant to her first cause of action, her second cause of action is for both wrongful discharge and refusal to hire.  So even if Ms. Carano was not an employee for the purposes of here §1101 claim, she would not need to be for her claim under California Labor Code § 98.6.  That section prohibits adverse employment actions against "any employee or applicant for employment" for conduct protected under §§ 1101 et seq.  

Ms. Carano cites to various projects of which she was going to be a part.  The problem is that, with the possible exception of a Mandalorian movie, the projects she mentions do not seem to ever have been made.  I think that might move her alleged harm into the realm of speculation.  If I had a dime for every time someone has approached me with a movie treatment based on this blog, well . . . you can do the math yourself.

Her third claim is sex discrimination, because male employees who engaged in expression similar to hers were not subject to termination.  I think the challenge here will be to show that the other expression is similar in legally relevant ways and to show that Disney had no non-discriminatory ground for deciding to end its relationship with Ms. Carano.  Ms. Carano cites to a social media post by Mark Hamill in which he linked to something from J.K. Rowling and "liked" it.  When people objected to the allegedly transphobic content of Ms. Rowling's post, Mr. Hamill issued a retraction of his "like" to the extent that it extended to that message.  Ms. Carano, by contrasts, insists that she has never, ever engaged in expression that was remotely objectionable.  To a company that cares about its image and disagrees with Ms. Carano's characterization of her social media posts, her refusal to acknowledge poor judgment may be a ground for treating her differently from those willing to recognize error.

Was Her Speech Covered by the Statute?

Disney may claim that her conduct was not "political activity" in the sense of the statute.  Here, the Complaint has to walk a rather narrow line.  On the one hand, Ms. Carano insists that her social media posts did not have the meaning ascribed to them by her detractors.  She insists that there was nothing in her posts that was racist, anti LBGTQ+, or transphobic.  On the contrary, she communicated only messages of love and support for people who are targeted for bullying.  Based on her own account of the events, it is a little hard to identify her political activities. 

She notes that other Disney employees engaged in more overt political statements and suffered no adverse employment effects.  But that may be a product not of whether Ms. Carano or her co-workers were people who were associated with the Star Wars brand were engaging in political activity but whether they were engaging in speech that the audience for Star Wars found objectionable.  Which brings us to our next topic . . . .

If Her Contract Has a Morals Clause, What Impact Does that Have on the California Statute at Issue?

Screenshot 2024-02-22 at 12.47.21 PMThis was the topic that Frank Snyder first broached on the AALS Contracts Listserv, and I, having no expertise in employment law, admit that I do not know the answer.  One would think that a morals clause would have to be interpreted in a manner consistent with California's Labor Code.  My hunch is that the case should turn on whether Disney's interest in enforcing its morals clause involved reasons unrelated to the allegation that Ms. Carano was engaged in political activity.  She was attracting a lot of negative attention on social media at the same time as she was emerging as the human face of The Mandalorian. The series' eponymous character (right) never shows his face (except for that one time when he did).  He is, according to the actor who plays him, "of questionable moral character." We don't even learn his name until episode 8.  Grogu is cute and all, but he's not human.  Ms. Carano's notoriety on social media may just be bad for business, bad for the brand, and they may have distracted attention from the heartwarming story of an isolated intergalactic mercenary with an inexplicable attachment to a child of an alien species with potentially gnarly powers but, if his predecessor is any indication, no hope of ever mastering standard English usage.

The Style of the Complaint

The Complaint's Introduction begins as follows:

A short time ago in a galaxy not so far away, Defendants made it clear that only one orthodoxy in thought, speech, or action was acceptable in their empire, and that those who dared to question or failed to fully comply would not be tolerated. And so it was with Carano. After two highly acclaimed seasons on The Mandalorian as Rebel ranger Cara Dune, Carano was terminated from her role as swiftly as her character’s peaceful home planet of Alderaan had been destroyed by the Death Star in an earlier Star Wars film. 

I have two problems with this way of introducing legal claims to a court.  First, the lame jokes and references to Star Wars themes undermine the seriousness of the document and of Ms. Carano's claims.  Of course, this blog is not above lame jokes and references, but we're a blog.  There's a time and a place.  Second, by casting the defendants in the role of the evil "empire "seeking to enforce "orthodoxy in thought, speech, or action" Ms. Carano risks having this lawsuit dismissed (by the public, if not by the court) as a chapter in the culture wars rather than an attempt to vindicate her legal rights.

The problems go beyond the introduction.  Pages 10-25, 28-30 of the Complaint consist of long-winded  detours into alleged online harassment of Ms. Carano by people other than defendants.  As far as I can tell, all of this information serves only to show why Disney might have had apolitical concerns about Ms. Carano's activities on social media.  It is not clear that any of this is otherwise relevant to the legal narrative Ms. Carano is trying to tell if she is seeking to vindicate her legal rights. It is highly relevant to the narrative she is trying to tell if she is attempting to burnish her credentials as a victim of the culture wars.  I don't think it is helpful in a Complaint to make the court feel like it is a platform for an agenda.

What's Not in the Complaint

Given the allegations in the Complaint, I'm not sure why there aren't more causes of action.  It seems like Ms. Carano thinks that the defendants have said and published statements about her that she believes are malicious lies.  That seems like a claim right there.  She also alleges that defendants not only wrongfully terminated her and refused to hire her for future projects; they also interfered with her efforts to procure other employment in the industry, including perhaps by pressuring her agents to sever ties with her.  That too, seems like a claim.  Perhaps an amended complaint is coming.  Perhaps I don't know what I'm talking about.

February 22, 2024 in Celebrity Contracts, Current Affairs, In the News, Labor Contracts, Television | Permalink | Comments (0)

Wednesday, November 29, 2023

Take the Money and Run, Pass, or Kick

Recently, Sid DeLong wowed us with an interesting perspective on the case of Danish performance artist Jens Haaning.  As readers of the blog well know, Haaning was commissioned to produce artwork incorporating $70,000 in Danish currency that the commissioning museum advanced to him for incorporation into the work.  Hanning never provided the work; instead, he delivered two blank canvases entitled Take the Money and Run.  

No biggy, Sid pointed out.  People get paid for doing nothing all the time.  Farmers get paid not to plant crops when the government is trying to control against overproduction.  Young William Story was entitled to collect from his Uncle William for successfully abstaining from certain corrupt behaviors before turning twenty-one.

Jimbo_A&M_Press_Conference
Image by Ethridgem, via Wikimedia Commons

But if you really want to get paid the big bucks for doing nothing, I recommend coaching.  As I learned from Bobby Chesney and Steve Vladeck on their excellent, most recent, edition of the National Security Law Podcast, Texas A & M University is paying Jimbo Fisher (right) $75 million for not coaching its football team between now and 2031.  

Doug Lederman provides some details in Inside Higher EducationAccording to the story, Mr. Fisher's contract was renewed in 2021 for ten years, and the contract was guaranteed, which meant that he would be paid whether or not he continued as coach.  You might be wondering how the taxpayers of Texas feel about having their money being used in a Bobby Bonilla style boondoggle.  The answer is probably that they are fine with it.  What's government for if not for building college football programs?  But just in case Texas taxpayers have other priorities, the university stresses that the $75 million will not come out of the university's regular budget but from "donor funds."

This strikes me as a relatively transparent shell game.  That $75 million in donor funds that will be going into Mr. Fisher's pocket are $75 million that the university might use for other, presumably sports-related, purposes.  And if the university cannot raise more private donor funds to attract its next football coach, or football stadium, or training facility, or whatever else it needs, the money to cover these new costs will indeed come from university funds that might have been used for, I don't know, educational purposes?

Burge_mark1 Snyder_franklin_gLast I checked, the Texas A &M football team is not ranked in either the AP nor the Coaches poll, nor did they have any votes in either poll, meaning that nobody polled thought that they were a top 25 team.  CBS Sports ranks them at 37.  Meanwhile, Texas A & M's law school is ranked 29th.  By my math, that ranking should entitle the law school's Dean to a guaranteed ten-year contract worth at least $85 million, and some portion of that money ought to go to the Blog, given that the Blog was founded by Texas A & M law faculty member Frank Snyder (left), and Texas A & M faculty member Mark Edwin Burge (right) continues to serve as a contributing editor.  Even a million or two would go a long way towards meeting the Blog's pressing fiscal needs.  I'm not asking for much.

One might think that Mr. Fisher will not in the end actually collect his $75 million from Texas A & M or its donors, because of the duty to mitigate.    But we've been down this path before on the blog, and I think we discovered that coaches who depart with guaranteed contracts do not have a duty to mitigate.  Mr. Fisher is perfectly free to move on to his next gig, command another Brobdingnagian salary, and continue to collect his spoils from Texas A & M.  In our world of the parable of his talents, this is righteousness.  Not compounding his windfall with greater lucre would be regarded as a wasteful, and Mr. Fisher would be consigned to that outer darkness, complete with ambient weeping and gnashing of teeth.

November 29, 2023 in Celebrity Contracts, Commentary, Current Affairs, Government Contracting, Law Schools, Sports | Permalink | Comments (0)

Friday, October 20, 2023

Weekend Frivolity: Contractual Chivalry

Hall BerryWe learned from Simon Gallager, writing on Screen Rant,  that director Matthew Vaughan quit as director of the X-Men III movie, despite his great success with earlier iterations of the franchise.  Mr. Vaughan claims that he quit in protest of a dirty trick that the studio was planning to play on Halle Berry (right).

According to Mr. Vaughan, the studio was trying to lure Ms. Berry back into the sequel by representing that it would have a much more prominent story line for Ms. Berry's character, Storm, than they actually planned to give her.  Mr. Vaughan discovered the script and thought it was an interesting idea -- it opened with Storm saving an African community during a drought by -- you guessed it! -- making it rain.  The executives told Vaughan that the script was just a ploy to get Ms. Berry to sign on for the sequel.  Once she had signed, their plan was to pitch the script . 

Mr. Vaughan took note of how they treated an Academy Award winning actor and decided he did not want to work for the studio.  Vaughan got the "You'll never work in this town again" speech.  I thought it was "You'll never have lunch in this town again." No? Anyway, he came back and made another X-Men film . I'm sure it was great.

All's well that ends well, I suppose.  Ms. Berry did get a larger role in X-Men, although there was no scene in which Storm saves Africans from a drought.  Instead, she took over Charles Xavier's school for mutants.  Taking over for Patrick Stewart?  Tough act to follow, but a nice coup for Ms. Berry.

The story highlights one of the many areas where my life experience as an academic limits my knowledge of how contracts work in the real world.  Clearly, scripts change in production all the time.  Scenes, perhaps whole characters perish with the other detritus on the cutting room floor.  We all know of Shirley MacLaine's case over Bloomer Girls, and Sandra Locke's suit over "Clint's deal."  I can't recall a suit over an editing decision.  Is there relevant contract language?  Does relational contracts theory explain why such suits rarely arise?

Instead of X-Men III, Mr. Vaughan made Stardust, an adaptation of a Neil Gaiman novel.  What the heck was I doing in 2007?  Claire Danes, Robert DeNiro, Michelle Pfeiffer, and a host of others!

October 20, 2023 in Celebrity Contracts, Film, True Contracts | Permalink | Comments (0)

Thursday, October 12, 2023

Will Katie Perry Be Known for Music or the PERRY Act?

Today's post was another gift from Miriam Cherry, that Holmesian gatherer of rare gem-like contracts stories.  She is as indefatigable as Sherlock and as legally savvy as Oliver Wendell. 

Katy Perry, as far as I can recall, is famous for having been creative enough to coin a singular for "fireworks" but not creative enough to find a word that actually rhymed with "firework."  "Worth"?  Nope.  "Burst"?  Nope.  Here's one that might be coming to your minds now:  "Jerk."  She is also known for her "left shark" dancer below.  

But she also is very into real estate.  We reported before about her attempt to buy a convent. She won that case, and only one nun died in the process (that we know about).

More recently, according to TheRealDeal, she and her husband, Orlando Bloom, attempted to purchase the Montecito estate of Carl Westcott, of 1-800-FLOWERS fame.  The sale price was $15 million, but Mr. Westcott, who is now 84 years old and suffers from Huntington's Disease, claims that he was not of sound mind when he agreed to the sale, not necessarily because of age or disease, but because he had just undergone a six-hour back surgery, and he was on pain medication.  Three years later, the parties are still embroiled in litigation.  

In order to avoid such problems in the future, some have proposed the Protecting Elder Realty for Retirement Years Act, or Katy PERRY Act.  According to its website, 

The Katy PERRY Act addresses the risks of elder financial abuse, especially as it relates to property and real estate sales and transfers. The Act establishes a 72 hour cool-down period during which either party involved in a contract for conveyance of a personal residence, in which one party is over the age of 75, can rescind the agreement without penalty.

If that Act had existed a few years ago, it might have prevented a firework.

October 12, 2023 in Celebrity Contracts, Legislation, Music, Recent Cases | Permalink | Comments (0)

Monday, September 18, 2023

Taylor Swift Has the Cure for COVID! And It Involves Contracts Law!

Taylor Swift
Image by Cosmopolitan UK,
CC BY 3.0, via Wikimedia Commons

Is there anything that woman cannot do?  Clearly, she can do anything she sets her mind to do, and if reviving the struggling movie theater business, with carry-on effects for shopping malls and other venues, is a positive externality of Taylor being Taylor, then so be it.  

For those of you who have avoided all human contact for the past decade, Taylor Swift (left) is a singer/songwriter who has had a number of hit songs.  Her international "Eras Tour" broke all imaginable records for successful concert tours, broke the Internet when tickets went on sale, and even generated a seismic event that registered 2.3 on the Richter scale, reportedly due to 70,000 white people trying to dance simultaneously to "You Belong With Me."  

As someone who does not particularly care for Ms. Swift's music but is surrounded by people who do, I have had no choice but to learn some of the details of her career.  So, I know that Ms. Swift does not like to share revenues with media industry bloodsuckers, like record labels and (now) movie studios.  

She has made headlines once again by leaving the studios out of the deal that will bring the Eras Tour to a movie theater near you.  Taylor Swift and her parents have cut the studios out of the process of financing and distributing the film version of her fabulously successful tour.  As Chris Eggertsen, reports on Billboard, the proceeds of the enterprise will be split, with 43% to be shared by the 1000 theaters at which the movie will be shown and 57% to be split between AMC and the Swift family.  Billboard reports (and I find this hard to fathom) that the theaters get to keep proceeds from concessions (fair enough) including from the sale of bespoke Taylor merch to be sold at the screenings (I'll believe it when I see it).  Theaters must agree to show the film for at least four weeks and may keep it up for as long as 26 weeks.  Taylor Swift now aims to beat Starbucks for market penetration.  

And of course, the records for sales for a new movie are dropping like flies.  The movie is not going to be released until October, but it seems like a safe bet that the Swifties will not lose their enthusiasm between now and then.  More likely, only Taylor-inspired bonding will prevent them from beating each other with friendship bracelets as they jostle for position in line.  No studio wants to release anything anywhere close to the release date for Ms. Swift's film, and for the first time in years, there is actually reason to buy AMC stock -- and not just to piss of the investment banks!  If there is a corresponding video game, I would recommend investing in GameStop next. One can anticipate people flocking back to theaters and the shopping malls that house them.  Social behaviors that we had completely forgotten about will return, and before long, we will re-familiarize ourselves with pre-pandemic life.  People will return to work, if only because the water-cooler conversations will now become opportunities to compete for the honors of having seen the movie the most and having bought the most Eras Tour merch.  And all thanks to Ms. Swfit!  

CubsI am a lifelong Cubs fan.  I thought I would never get tired of the song "Go, Cubs, Go."  Then they won the World Series.  The weekend of the victory parade, I took a train into Chicago to attend Loyola Chicago's annual Constitutional Law Colloquium.  The train lasts about an hour, and my fellow Cubs fans were irrepressible, breaking out into song at the slightest provocation and with no regard to pitch or timbre.  I was relieved to step off of the train at my destination station, where "Go, Cubs, Go" was playing over the public address system.  I'd had it.  I was officially tired of the song.  Will the Swifties ever tire of their darling.  All signs point to no.  Well, let them enjoy their pleasure.

Twenty-six weeks may be enough, but expect it to have an afterlife akin to that of the Rocky Horror Picture Show, with dedicated Swifties heading out week after week to the Saturday night showing of The Eras Tour, complete with a pre-show costumes, Karaoke contests, and Taylor-wannabe talent shows.  And of course, the entire concert will be a sing-along punctuated by shrieks and shouts of adoration directed at the image of the singer.

AMC has visions of "Taylorstyle" deals moving forward.  That seems unlikely.  Her charms are lost on me, but they are undeniably unique and powerful.  I cannot think of another performing artist who could replicate this deal.  Maybe Beyonce? And just so that my Swiftie students will actually look at this blog, here's the trailer:

 

September 18, 2023 in Celebrity Contracts, Current Affairs, Film, Film Clips, In the News, Music | Permalink | Comments (0)

Friday, August 4, 2023

Book Contracts and Supreme Court Ethics

AlitoMany have lamented the fact that the U.S. Supreme Court is the only federal court in the country not bound by the federal Code of Conduct.  As reports in The Washington PostChief Justice Roberts  rejected calls for the court to adopt its own ethics code.  Even if it were to do so, it is hard to imagine how it would be enforced. 

Justice Alito (left), in an interview with the Wall Street Journal (behind a paywall), said (as quoted in 's reporting in Reuters), "No provision in the Constitution gives [Congress] the authority to regulate the Supreme Court — period."  That is manifestly untrue and manifestly irrelevant.  It is untrue because the Constitution grants Congress the authority to impeach Supreme Court Justices.  That is a constitutional mechanism of regulation.  But even if there were no express provisions in the Constitution, the system of checks and balances that the Constitution creates gives rise to implied congressional powers to regulate the Supreme Court.  Justice Alito, who with his colleagues regularly engage in the practice of constitutional review, is undoubtedly aware that there are constitutional powers that exist notwithstanding the lack of any express constitutional provision to which one can point as the source of that power.  

Notwithstanding strong arguments for Congress's power to regulate the ethics of Supreme Court Justices, it has not exercised that power.  The remedy for ethics breaches by Supreme Court Justices, as things stand, would be impeachment, but it is hard to imagine any ethics lapses that would garner 67 votes for impeachment in the Senate.  

Which brings me to the topic of Justice Sotomayor's book tours.  It is very common for authors to promote their books.  For example, you might be interested in an edited collection of essays on Hans Kelsen in America.  There.  That was pretty shameless, wasn't it?  Unethical?  I don't know.  There is no code of ethics for law blogs.  See what I did there?

If an author is a celebrity, they have far more opportunities to promote their books, and some of those can be quite lucrative.  It is perfectly normal for an author to arrange readings and signings and to have the publisher ship books to the location where the reading will take place.  For celebrities, having people line up to have you sign their books is a great way to get people to buy the book, and the author may not mind if many of them don't read past the inscription.

SotomayorBut it is arguably a different matter when a Supreme Court Justice profits from such tours, and those tours raise ethical questions if hours of Court time are devoted to preparing for the book-related events and to pressuring hosts of book readings/signings to buy thousands of copies of the book.  According to Brian Slodysko and Eric Tucker, writing for the Associated Press, Justice Sotomayor (right) has earned $3.7 million through book sales since she joined the Court, and she was involved in book-related events, including one that involved Michigan State University's purchase of $100,000 worth of Justice Sotomayor's memoir.  The story indicates that Court staff not only coordinate book tour events but pressure the hosts of such events to purchase far more copies of the books than they originally intended.

Some of the story, as reported, doesn't make a whole lot of sense.  The story suggests that Justice Sotomayor had thousands of book sent to her chambers for signing.  That strikes me as absurd.  You don't sign 11,000 copies of your book and then give a reading at which people line up to have you sign your book.  I suppose it is possible that they sign up to get an inscription beyond the signature, but from a marketing perspective, that seems like an odd way to do things.  But the AP report has documents showing that thousands of books were sent to the Supreme Court.  Given the large advance and royalties the Justice earned through this publication, there is no reason why Court resources should be involved in its distribution.  The publisher is making a lot of money here; let it send some low-level staff to organize the signing event and arrange for the shipment of the books to the relevant venues.  The signings can take place . .  . at the book-signing events.  Book publishers ought to know more about how to run such an event than Court staff.  And Supreme Court Justices have better things to do with their time than sign their names 11,000 times.  So does Bob Dylan, as we discussed here.

In my view, the country would be better off if Supreme Court Justices were not all millionaires, but given the extent to which members of Congress are able to enrich themselves, Congress is in no position to scold the Justices for profiting from their status.  In the current environment, it is hard to see how book royalties, regardless of their magnitude, can constitute an ethics violation, and I see a lot of value in the book tours.  They get the Justices out of the Beltway and give them opportunities to engage with ordinary citizens.  To the extent that people come up to have their books signed, that is an opportunity for one-on-one interactions with a Justice, which can be inspiring -- especially for young people -- in so many ways.  With Justice Sotomayor, there are issues because her publisher had business before the Court, and she failed to recuse herself.  It appears that she acknowledges that this was wrong and attributes it to a gap in the Court's conflicts processes that has now been addressed.

In this case, and in every case involving Justices profiting from their celebrity and possible misuse of public resources, Justice Sotomayor is entitled to argue that she had no idea that her conduct might raise ethical scruples.  If she were so inclined, she could point to other instances of similar conduct by other Justices or she could simply raise rhetorical questions about why Justices should be expected not to do what other authors do without raising hackles.  But with an ethics code in place, Justice Sotomayor would not have to make such arguments.  She would know the bounds of permissible behavior, and she would not act outside of those bounds.

August 4, 2023 in Books, Celebrity Contracts, Commentary | Permalink | Comments (0)

Thursday, June 29, 2023

Court Grants Preliminary Approval to Settlement of Class Claims Against Trump Campaign

Last week I defended Donald Trump against allegations that he had broken a promise to buy "food for everyone."  That gives me the credibility I need to cover the settlement of a class-action lawsuit against the enforcement of the 2016 Trump campaign's standard non-disclosure agreement (NDA).  We are nothing if not fair and balanced at the ContractsProf Blog.

Trump_Pence_2016
We have covered Trump NDAs before here, here, here, here, here, here, here, and here.  In sum, I think there are two main takeaways.  First, Donald Trump and organizations associated with him love NDAs.  Second, they tend to draft NDAs that are so preposterously overbroad as to be unenforceable.  The litigation does not go well for Mr. Trump and affiliated entities, and they do not seem to learn any lessons from the experience.  They keep losing and losing and yet never get tired of losing. 

Tump & PenceMaggie Haberman reported in The New York Times back in February that the Trump campaign had agreed to pay $450,000 to settle claims brought by Jessica Denison on behalf of herself and all others similarly situated.  Ms. Denison is to receive $25,000, and the rest will go to cover attorneys and court costs.  Ms. Denison alleged abusive treatment and sexual discrimination by a member of the campaign team.  The aim of settlement was to invalidate the NDA and free others to speak about their experiences as part of the Trump team during the 2016 campaign, and Ms. Denison is bringing her claims in a separate suit.  

In a June 7, 2023 order, the District Court noted its earlier order, invalidating the NDA as to Ms. Denison.  She sought an order invalidating it as to at least 422 potential class members.  That proved unnecessary, as the Campaign agreed in writing to release everyone associated with the Campaign from obligations created by the NDAs.  The Court further certifies the class and sets out procedures for notice to class members and a schedule for final approval of the settlement.

June 29, 2023 in Celebrity Contracts, Commentary, Recent Cases | Permalink | Comments (0)

Tuesday, May 16, 2023

Reefer Brief: Ignite International in Contract Dispute with Consulting Firm

Dan Bilzerian
FILMORA NEWS, CC BY 3.0, via Wikimedia Commons

According to Law360 (behind a paywall), a Nevada District Court has ordered Instagram Celebrity and CBD oil entrepreneur Dan Bilzerian (left) to pay $1.6 million and dismissed a breach of contract claim.  Prior to that decision, the case generated a lot more heat than light. 

There are some larger-than-life characters involved.  Dan Bilzerian is the son of Paul Bilzerian.  According to Wikipedia, Paul was a successful entrepreneur and takeover specialist until he ran into trouble with the SEC and was jailed in the early 199os.  After his release from prison, Paul launched a Utah-based software company, Cimetrex, but the government confiscated his ownership interest in that company in 2002.  Paul declared bankruptcy in 1991 and again 2001, but, according to Dan Bilzerian's Wikipedia entry, the government alleges that he concealed assets, passing some of them on to his two sons.  It is unclear whether Dan used those funds or his poker winnings to fund his companies, Ignite International Brands and affiliated entities (collectively Ignite).  Paul played a role in the negotiations between Ignite and a consulting firm, Consulting by AR (AR) .

Piecing together the nature of the dispute from redacted pleadings found on Westlaw, Alan Richardson, AR's principal, reached out to Dan Bilzerian in January 2021 to offer his consulting services in assisting Ignite in gaining a marketing foothold in Las Vegas.  Ignite, in case you were wondering, markets vaping products, spirits, apparel for people who prefer not to leave much to the imagination (based on the website), and at least at one point, a CBD-infused lip balm (hence its presence on the Reefer Brief).  AR hoped to link Ignite's products with Las Vegas's newest casino and resort, Resorts World Las Vegas (Resorts World, below right)).  The parties entered into a letter agreement in March 2021, providing that AR would be compensated with stock in Ignite should an agreement with Resorts World be completed by July 1, 2021.  

Problems arose according to AR's counterclaims, with Dan Bilzerian demanding a better deal than the one originally negotiated. AR claims that it successfully negotiated terms more generous to Ignite than those in the original letter agreement.  In April, 2021, the parties entered into a Letter of Intent, the terms of which provided for a strategic partnership between Ignite and Resorts World.  Dan Bilzerian then appeared at Resorts World's grand opening in June 2021, as required under the letter agreement.  Afterwards, AR claims that it facilitated an updated letter agreement, with terms still more favorable to Ignite than previous iterations had been.  

Resorts_World_Las_Vegas_May_2022
Logan Frick, CC BY-SA 4.0, via Wikimedia Commons

Thereafter, AR alleges that Ignite ceased to cooperate with AR, refused to pay any compensation to AR, and accused AR of poisoning its relationship with Resorts World.  After an exchange of letters relating to the possibility of arbitration, AR sent a demand letter.  Paul Bilzerian wrote to Alan Richardson, urging settlement.  Here are some excerpts from that letter as cited in AR's counterclaims;

Hi Alan, I understand that your lawyer sent a letter to Ignite that essentially said either Ignite accedes to your demands or suit will be filed next week. I know Ignite will not be happy with this response so it is pretty clear where this is headed at the moment. . . .  Of course your lawyer will tell you that you have a great case and can't lose. I have heard that speech so many times over the past 43 years I lost count decades ago. . . .  You do have some goodwill left on the Ignite side which is why Paul Holden [Ignite's general counsel] suggested binding arbitration. . . .  All you need to do is choose the path you want to follow: prompt, cost effective settlement or bitter, costly, scorched earth litigation with the only winners being the lawyers. I hope you make a good choice.

Notwithstanding this letter, it was Ignite that filed suit, seeking a declaratory judgement.  AR counterclaimed.  The parties have spent much of the intervening period in discovery disputes.  It did not go well for Ignite.  Here, for example is an August 2022 decision of the District Court ordering Ignite to file under seal 65 documents allegedly subject to claim of privilege.  Here is a March 2023 order, finding Ignite in contempt for its failure to do so.  The $1.6 million judgement followed just weeks later.  We will see if the Bilzerians pay for a quick end to the matter or, take Paul Bilzerian's road oft-traveled road of scorched-earth litigation with the only winners being the lawyers.  Either way, he will have been proven correct.

Ignite filed its appeal with the Ninth Circuit on April 28, 2023.  Perhaps they did so, like King Croesus, based on the advice of the Delphic oracle, who said, "If Ignite makes war upon AR Consulting, it will destroy a great empire." 

May 16, 2023 in Celebrity Contracts, Current Affairs, Food and Drink, Recent Cases, True Contracts | Permalink | Comments (0)

Friday, March 31, 2023

Metropolitan Opera Ordered to Pay $200,000 to Putin Stan Anna Netrebko

We have been posting occasionally on the interaction of the Russian war against Ukraine on the blog.  The most recent such post is here.  Today, care of  Javier C. Hernández and The New York Times, we have a new installment.

Netrebko & Putin
By Kremlin.ru, CC BY 4.0

Russian soprano Anna Netrebko (pictured at right receiving the State Prize of the Russian Federation) was scheduled to perform at the Metropolitan Opera in Don Carlo this season and La Forza del Destino and Andrea Chénier next season but the Met cancelled those performances when Ms. Netrebko refused its demand that she denounce Vladimir Putin after the Russian invasion of Ukraine.  

An arbitrator awarded Ms. Netrebko $200,000 under a "play or pay" clause in her agreement with the Met, finding that her support for Putin did not rise to the level of moral turpitude nor was it actionable misconduct.  However, the arbitrator did fine her $30,000 for "highly inappropriate" statements on social media.  The Met has also terminated Ms. Netrebko's husband, tenor Yusif Eyvazov, who was slated to perform in Tosca.  The Met says that they will compensate Eyvazov.  Ukrainian soprano Liudmyla Monastyrska will sing the role of Tosca in four performances.

Admittedly, Netrebko is in a tough spot.  Facing cancellations throughout the West (but she has performances scheduled in Vienna and Milan), she has attempted to distance herself from Putin saying that she met him only a few times, but the penalties she might face in Russia were she to denounce the invasion could be far more grave that losing a gig at the Met.  As Radio Free Europe/Radio Liberty reports, Putin recently signed into law a new provision in Russia's criminal code that provides for up to fifteen years in prison for "false news" relating to the Russian military.  reports in The Guardian on Alexei Moskalyov, whom Russian authorities tracked down in Belarus after he attempted to escape form two years of house arrest, in part because of anti-war drawing by his 13-year-old daughter.  She was removed from his care and placed in a state-run rehabilitation center.  

March 31, 2023 in Celebrity Contracts, Commentary, Current Affairs, In the News, Music | Permalink | Comments (0)

Tuesday, March 28, 2023

Warner Bros. to Paramount: Screw You Guys, I'm Going Home!

I learned from OCU 1L Austin Manley that the South Park guys seem to have sold exclusive rights to their show twice.  Well, maybe not.  It's a matter of interpretation. 

KennyMcCormickAs Gene Maddaus reports in Variety (complaint at the bottom of the story), HBO's parent company, Warnermedia Direct is suing Paramount and others for breach of a 2019 deal in which HBO claims it won an intense bidding war by offering  $500 million for an exclusive license to stream episodes of the South Park animated television series, including three seasons' worth of new episodes.  It's a nifty little contract interpretation/good faith issue, because while HBO has the exclusive right to stream episodes of the regular South Park series, Paramount is claiming to have retained the rights to stream specials and other content.  HBO is screaming, "You bastards!"

But it gets worse: HBO claims it was promised at least ten episodes per season, but it has gotten only only eight, with six more slated for the third promised season, giving HBO a total of only fourteen of at least thirty promised episodes.  Because new episodes are far more valuable than the library of old episodes, HBO claims, what it got is worth far less than the $500 million it paid.

Sidebar: really?  I mean, yes, usually, I would be far more interested in new episodes than old episodes, but I haven't watched South Park in over a decade.  Have I missed anything?  Recently I warned my students that because nobody comes to my office hours, they should probably send me an e-mail to let me know they are coming.  Otherwise, I forget that I'm holding office hours, pull a Towelie, and just wander off.    Crickets.  According to the Complaint, "South Park is premium content and a top performer, especially with the highly prized 18-34 audience that is dedicated to the show and engages in repeated viewing."  My students don't even know who Towelie is.  So if old fans of the show (me) aren't watching the show, and my students are not watching the show, why are new episodes valuable? My students are within the 18-34 target audience, and either they are not watching the show or they are gaslighting me.  And if I were willing to shell out money for HBO Max, I would be far more likely to watch old episodes than new.  I have access to all 3,759 seasons of The Simpsons, but I'm mostly interested in Seasons 2-5.

Parker & Stone
Image by Gage Skidmore, CC BY-SA 3.0 

But wait, there's still more.  Paramount, through its subsidiary MTV, has announced a $900 million deal with the South Park creators, Trey Parker and Matt Stone (above)for exclusive South Park content to run on Paramount +.   Why can't stuff just be on TV like it used to be?  The new content is not "episodes" Paramount maintains; it is "movies," "films" (is that just movies shot in black and white?), and "events"?   Indeed, according to the Complaint, Paramount has acknowledged that South Park content is at the heart of its strategy to develop Paramount +.   

According to the Complaint, Paramount and its joint venture with Parker and Stone informed HBO that it could not make new seasons during the COVID-19 pandemic.  But during that same pandemic, it produced two South Park 50-minute specials that aired on Comedy Central, a Paramount subsidiary.  Two recent "supersized" specials aired on Paramount + with the seemingly self-referential titles The Streaming Wars and The Streaming Wars, Part 2.  The whole thing is so over-the-top, convoluted, and at least based on the Complaint so obviously wrongful, it reads like a plot from a South Park episode.  No wait, this is too big for an episode -- a South Park movie.

The Complaint alleges causes of action for breach of contract and the implied covenant of good faith and fair dealing, statutory claims, tortious interference, and unjust enrichment.  It seeks not only damages for breach of contract, but also disgorgement and punitive damages.  Expect counterclaims alleging that HBO has failed to pay the licensing fees.

March 28, 2023 in Celebrity Contracts, Current Affairs, Television, True Contracts | Permalink | Comments (0)

Wednesday, March 15, 2023

Flo Rida Wins $82 Million Judgment Against Celsius Energy Drinks

Flo RidaAs Marisa Dellatto reports in Forbes, rapper Flo Rida prevailed in a jury trial on his claims against energy drink company, Celsius.  Being a man who can now count his age in decades, I had never heard of or taken note of this line of beverages or of Flo Rida, but my daughter went to Flo Rida concert last year, and now I am seeing Celsius ads every time I stream content on services that have ads.  Live and learn.

The suit arises out of an endorsement deal that Flo Rida (Flo? Mr. Rida?) signed with with Celsius.  The deal was renewed in 2016 and terminated in 2018,  Flo Rida claimed that he was entitled to shares in the company, and a jury agreed.  Celsius argued that the statute of limitations had lapsed, but the jury found(!) that Celsius was equitably estopped from making such an argument.  

The verdict consists, in part, of 250,000 shares in the company, which at the time of the verdict were selling for $110/share.   That accounts for $27 million of the verdict.   I'm not sure where the rest comes from. 

Flo, I've never tasted the stuff, but my advice is: liquidate your shares in a hurry, because this stuff has fad written all over it.  It's already down to $84.50/share, but as recently as May 2020, it was below $5/share, and those times may well return. 

March 15, 2023 in Celebrity Contracts, Food and Drink, Recent Cases | Permalink | Comments (0)

Thursday, March 2, 2023

Unilateral Contract or Just Blackmail?

 

Lady_Gaga_at_Joe_Biden's_inauguration_(cropped_5)Here is a new twist on a familiar narrative.  

Celebrity loses dog.

Celebrity offers reward for dog.

Celebrity refuses to pay person who finds and returns dog . . . 

and now the twist . . .

because the finder is the person who conspired to kidnap the dog and who was convicted as part of a conspiracy to do so, which also involved shooting the celebrity's dogwalker.

In February, 2021, Lady Gaga's assistant was walking Lady Gaga's bulldogs, Koji and Gustav (for images of the dogs, you can watch this video), when she was shot and her attackers made off with the dogs.  Two months later, five people were arrested in connection with the dognapping incident.  One of those people was Jennifer McBride, who returned the dogs.  She had a connection with the father of one of the men involved in the attack, and she pleaded no contest on one count of receiving stolen property.  She received two years probation.

But apparently that brush with fame did not sate Ms. McBride.  As Paige Skinner reports on BuzzFeed News,  Ms. McBride noted that Lady Gaga had offered $500,000 to anyone who returned the dogs "no questions asked." Ms. McBride now claims to have complied with the terms of Lady Gaga's unilateral offer.  Worse still, she alleges that she was the victim of a fraud perpetrated by Lady Gaga when the latter allegedly made a promise she never intended to perform.   In short, Ms. McBride claims that she was tricked into returning the stolen dogs.  That sneak Lady Gaga intended all along for the police to question Ms. McBride about how she came into possession of the dogs all along.  The nerve!

Marisa Sarnoff of Law and Crime provides some additional details, including a link to the complaint (journalists of the world, take note -- this is what we all want to see!).  The fraud claims are crucial because Ms. McBride alleges harms, including pain and suffering, mental anguish, and loss of enjoyment of life.  As a result, she claims entitlement not only to $500,000 in compensatory damages but also to $1.5 million to compensate her for the foregoing tort harms.

Hat tip: Meredith Miller

March 2, 2023 in Celebrity Contracts, Current Affairs, In the News | Permalink | Comments (1)

Wednesday, February 1, 2023

Justin Bieber Is Selling His Soul. No, That's Not News. He's Selling His Music

As , in conversation with Eamonn Forde, reports in The Guardian, Justin Bieber (below -- honest, I'm not trying to be mean (yet) by posting his mugshot; it's the only public domain image I could find!) has entered into a $200 million deal giving Hipgnosis Songs Capital the rights to all of his music recorded before 2021.  Baby, baby, baby, oh, that's a lot of money!  But it covers 290 titles, even though I can only think of one.

BiebermugshotThe transaction is an indicator of a trend.  Music is back, according to The Guardian, with album sales climbing in the U.S. over the past two years.  I'm not sure what these guys mean by "album," but whatever. 

And it's not just about you-know-who who is committed to owning all of her own music and insists on bringing out a new (old) album every year in order to do so to the delight of her fans who apparently are unaware that the world is teeming with talented artists of whom they've never heard (like Sarah Dooley) because all they listen to is this poor girl who is the most downloaded artist in history but for some reason is still singing about somebody who broke up with her ten years ago when she is not setting records for use of her private jet in a year when she's not even touring. 

Haters gonna hate. 

Actually, I wouldn't hate this artist if she were just stupendously successful.  I hate that she takes up all the oxygen in the room so that no other artists can breathe (and my students disappear for 48 hours after she drops a new album so that they can commit every syllable to memory and then shoot each other knowing looks when I accidentally use some utterly humdrum phrase that also happens to have found its way into her lyrics, which are 98% utterly humdrum phrases. 

But I digress.

Anyhew, Hipgnosis is a big player in the market, and that company and its rivals are betting on the long-term value of the songs that they are buying up.  Hipgnosis principal proclaims himself to be a "disruptor" who wants to destroy the traditional model of music publishing.   It's not clear to me that there's anything left to destroy, but his company has literally spent billions of dollars on demolition, so I suppose there's still work to be done.  

Among the things that makes me wonder whether the parties know what they are doing is the round numbers involved in these transactions.  According to the Guardian, "Stevie Nicks sold her catalogue for $100m. Bob Dylan shed his for a cool $300m-400m. Bruce Springsteen tops the lot at $550m."  Okay, so a Bieber is twice a Nicks and half a Dylan?  But also, what are these numbers based on.  If there were a formula, it would produce a number with more significant digits.  I think these deals are very rough guesstimates to true value, which is why I have decided not to buy the rights to all of Britney Spears' music just yet.

February 1, 2023 in Celebrity Contracts, Commentary, Music | Permalink | Comments (0)

Monday, December 26, 2022

Sid DeLong: Risks Associated with Name, Image & Likeness Deals

Tom Brady: From G.O.A.T. to Scapegoat:
A Cautionary Tale of Influencer and Endorser Liability
Sidney W. DeLong

Tom BradyIf the next Tom (the Greatest Of All Time) Brady is in college today he is sure to be earning a lot more money than Tom was able to scrape together as a student athlete when he played for Michigan. As predicted in an earlier post, Name, Image, and Likeness Mercenaries: NIL Desperandum in College Athletics, the next Tom is already aboard the Name, Image, Likeness (NIL) bandwagon that has already showered millions of dollars in “endorsement” income on student-athletes. The NIL beneficiaries are Very Definitely Not being “Paid to Play” for the schools that woo them to step through the Transfer Portals into a world of big money endorsement contracts. Star athletes can earn tens or hundreds of thousands of dollars, ostensibly as pitchmen for local car dealerships and plumbing companies. All of which is good practical training for the much more lucrative and slickly produced product endorsements for which they will be paid when they become professionals, endorsing insurance companies, sneakers and fast food.

And in a sense, NIL income for athletes is only fair compensation for the hard and dangerous work they must put in to earn their scholarships. Star athletes must keep up financially with their non-athletic but internet-famous classmates who pull down five and six-figure salaries as Influencers, persuading their followers to buy whatever music, fashions, and cosmetics that their advertisers are paying them to pitch. “Influencer: It’s not just a side-hustle, it’s a career.”

But the shock waves emanating from recent collapses in the world of crypto portend risks that a fledgling NIL athlete or Influencer might well bear in mind. It turns out that touting a product as a celebrity endorser or influencer can lead to significant personal financial liability for the endorser, especially if what is being touted is not a diet plan but what a judge may later call a “security.”

Endorser liability is a relatively new concept and the courts have not yet evolved clear rules. The common law offers few theories under which a buyer might sue a seller’s agent for personal liability resulting from misleading statements the agent made about a purchase of a commodity, whether in the form of facts or opinions. Lies by a non-seller might justify avoidance or a warranty claim against the seller, but the agent owes no common law duty to the buyer to make only truthful statements about the product.

Lady DuffBy statute, however, two forms of endorser liability have emerged in the U.S. For the sale of goods, The Federal Trade Commission has issued regulations making it illegal for a product endorser to fail to disclose whether she is compensated for her endorsement or to publish a misleading consumer product review of the product. The FTC has even published “guidelines” for social media influencers.  Because these rules are aimed at misleading endorsement rather than misstatements of fact, liability can be avoided if the celebrity announces, ‘I am just saying this because I have been paid to do so.” Of course, such candor would defeat the purpose of the endorsement. Actual disclosures are more subtle, but effective in avoiding liability. But the American public has always been fully aware that every celebrity endorser since Lucy, Lady Duff-Gordon (left) has compensated and so the formalistic acknowledgement of compensation that is demanded by the FTC seems to be a solution in search of a problem. Or perhaps an example of straining at a gnat and swallowing a camel.

A far more lethal risk arises if the product being endorsed is held to be a security as defined in federal and state law. Which leads us to the crypto disaster. Tom Brady, along with his wife Gisele Bundchen, Shaquille O’Neal, Naomi Osaka, Larry David, Steph Curry, and many other celebrity endorsers of crypto products have been sued for damages and fines by the Securities and Exchange Commission (SEC) and classes of private parties under theories of securities act violations, violations of FTC disclosure regulations, and common law fraud, all arising from their promotional activities on behalf of FTX, Crypto.com and other sellers of crypto assets.

Kim KardashianIn a widely-publicized enforcement action, Kim Kardashian (right) was fined $1. 2 million in penalties plus disgorgement of profits by the SEC for failing to disclose a $250,000 payment she received to publish a post on her Instagram account promoting EthereumMax’s crypto asset security EMAX tokens. The article suggests that Matt “Fortune Favors the Brave” Damon was not charged because he was promoting a website, Crypto.com, rather than a specific security offered by his principal. More importantly, because EthereumMax’s tokens declined in value by 98% following Kardashian’s promo, she has been sued by disappointed investors for their losses.

Even the question whether Bitcoins themselves are securities may be an open question about which legal advice would be necessary. Gary Gensler, Chairperson of the SEC, has said that he believes that most cryptocurrencies are securities, as defined under the Howey Test, leading many to anticipate regulation of the market. If a celebrity touts an unregistered security, that alone could subject them to potential fines and jail time as well as to civil claims by disappointed purchasers regardless of the celebrity’s disclosure of their interest.

In addition to liability for fraud or for promoting the sale of unregistered securities, endorsers may run afoul of the SEC’s statement of policy about “celebrity backed” initial coin offerings requiring disclosure of compensation paid for endorsements (concerning the policy relating to “initial coin offerings”). Under this theory, Brady and Bundchen may have additional disclosure obligations arising from an alleged equity stake they took in FTX in 2021, before the endorsements.

What conclusions should a lawyer representing Future Tom Brady or Future Gisele Bundchen draw from the GOAT’s latest problems? I would suggest at least the following.

First, you should have final review of any endorsement contract and should not depend on the endorsement agent’s version, whose financial interests are not coincident with his own. Tell the client that “Jerry Maguire is interested only in his cut of the promotional fees; he won’t be there for you when you are sent away for securities fraud.”

Second, you will require securities law expertise whenever there is any possibility that what the client is touting is a security. With novel crypto products, it may be months or years before the courts decide whether the thing being touting is a “security,” under some version of the Howey test. Emphasize to the client that the personal liability for violating the securities laws can be staggering: that is the reason that liability insurance for securities lawyers is so expensive. An endorsement fee cannot possibly compensate for this level of risk.

Matt DamonThird, insist that the entity paying for the endorsement agree to indemnify the client and hold them harmless from any liability they may incur to any person or organization resulting from their performance of the endorsement contract. The indemnity must also include compensation for attorneys’ fees and other professional fees incurred, tax-related losses, and any other financial liability resulting from the product endorsement. (An agreement to pay criminal fines might be unenforceable on grounds of public policy, but it cannot hurt to obtain it.) If you cannot obtain indemnity, you should probably advise the client to walk away from the deal. If they refuse, you should (sad to say) probably memorialize your advice to the client.

When Matt Damon (left) told America that “Fortune favors the Brave” he was really sending a double message. He was not only encouraging ordinary people to risk their life savings on Bitcoin in a bold bid to earn a fortune. He was also, by his own example, encouraging celebrities to risk losing everything they owned in a securities fraud class action just to earn a hundred-thousand-dollar fee. Both messages proved to be disastrous, but at least some of the celebrities may end up as the bigger losers.

December 26, 2022 in Celebrity Contracts, Commentary, Sports | Permalink | Comments (0)

Thursday, December 22, 2022

The World Cup of Contracts: Bend Contractual Obligations Like Beckham?

BeckhamLast week, Tariq Panja spilled the tea in The New York Times about David Beckham's contract to promote Qatar in connection with the World Cup and his utter failure to do so in any way that would have the sort of impact for which Qatar shelled out (perhaps?) $150 million.  That said, he didn't exactly breach either.  He kinda ChatGPT'd it. 

Some people think you ought to actually enthuse to the media about Qatar when you enter into a contract to promote Qatar.  Others think that you ought not to promote Qatar in connection with the World Cup if that might force you to opine about workers' rights or LGBTQ+ issues.

Or so I imagine ChatGPT would respond if I asked it about Beckham's contractual performance.

World_Cup_Opening_Ceremony_in_Doha _Qatar_(52515886760)Mr. Beckham's strategy, according to the New York Times, is to show up for events when asked, on condition that his appearance not be announced in advance and the press not be notified.  Mr. Beckham's bearded visage can be seen all around Qatar, on billboards and signs promoting Qatar and the World Cup, but the man himself is rarely seen and largely inaccessible.  When pressed to speak about why he is endorsing Qatar or about his views on the various controversies that swirled around the World Cup and its 2022 host, Mr. Beckham issued press statements that sounded genuine, by which I mean that they genuinely sounded like they were generated by ChatGPT.  Some samples:

David has been involved in a number of World Cups and other major international tournaments both as a player and an ambassador and he has always believed that sport has the power to be a force for good in the world.

We understand that there are different and strongly held views about engagement in the Middle East but see it as positive that debate about the key issues has been stimulated directly by the first World Cup being held in the region.

Other celebrity sponsors of the World Cup have apparently been irked by Mr. Beckham's special treatment.  But some of them, unlike Mr. Beckham, have won the World Cup tournament, so there may be some consolation in that.

December 22, 2022 in Celebrity Contracts, Commentary, Sports, True Contracts | Permalink | Comments (0)

Wednesday, November 30, 2022

The Signature of the Artist in the Age of Its Mechanical Reproducibility

Dylan 1966
Mr. Dylan, in 1966

Mark Savage reports on BBC.com that Bob Dylan has apologized.  You need not read any further.  That is news in and of itself.  I'm wracking my brain.  Has Bob Dylan ever apologized before?  For anything?  Isn't that more of a John Denver vibe?

What has finally made the American Bard issue an apology?  Breach of contract, of course.  Mr. Dylan's publisher, Simon & Schuster sold for $600 each 900 "hand-signed" copies of Mr. Dylan's new book, The Philosophy of Modern Song.  Some Dylan aficionados, it turns out, were also signature aficionados, and they discovered that the "hand-signed" books were signed using an autopen.  The publisher went through the five stages of settlement: anger, denial, reference to "letters of authenticity," consultations with PR, the offer of refunds. 

For his part, Mr. Dylan regretted an "error of judgment," but he also offered explanations.  He has vertigo, so it takes a team of five to accompany him during signing sessions.  I recently saw Bob Dylan in concert, and I can confirm that he is unsteady on his feet.  During the pandemic, such sessions became a health risk and so, "with contractual deadlines looming" (that's an actual Dylan quote!!) when some unnamed person recommended the use of the autopen, accompanied by assurances that people do it all the time, Mr. Dylan agreed to auto-sign copies of his book.  The BBC report suggests that other artists have indeed used the same device.  Sinead O'Connor was unapologetic, but signed copies of her book sold for £30, so no big deal.

Walter_BenjaminWhat is the difference in value between a book hand-signed by Bob Dylan and a book auto-signed by Bob Dylan?  Apparently, quite a bit, and the reason for that turns, contrary to what Walter Benjamin (left) would have you believe, on the ability of works of art to retain their auras, even when they have been stripped of their unique existence in an (often sacred) time and space.  Remy Tumin reports in The New York Times on what motivated one fan, who already owned the book in both in hardcover (unsigned), audio, and Kindle versions, to buy the signed version. “If he touches this book — he wrote it, signed it — it feels like the soul of Bob Dylan is with me.”  That, my friends, articulates the power of the aura of an authentic work of art, or at least, a thing touched by the artist.  

There is a great deal to unpack in all of this, and I wish Benjamin were around to reflect on it.  Works of art once had a specific cultural role.  They elevated and celebrated; they connected us to the divine.  In the modern, disenchanted world, when they became reproducible, the cult value of the work of art is supplemented and eventually replaced with its exhibition value.  The role of the work of art changes as the sources of its value changes.  Benjamin celebrated the transformation of the social function of art.  Art, freed from cultic aura, is democratized.  Pictures, movies, electronic files, etc. can be endlessly reproduced and enjoyed by the masses.  The museum, the gallery, the cafe, the salon, the cinema become the new settings in which the work of art does its work.

At this point, one wants Adorno to step in and to warn about the susceptibility of art to commodification.  People still long for the cultic aura -- the verisimilitude of proximity to artistic creation.  We cannot look over Bob Dylan's shoulder as he writes "Mother of Muses" (below), my favorite song on Rough and Rowdy Ways.  He will not premiere his new songs for us.  The best we can do is buy memorabilia, and we value that memorabilia to the extent that we think it connects us to art or the artist, but the connection is attenuated, shrouded in mists or mysticism.  And then we degrade the artwork's aura (or that of its creator) by reducing its value to the cash nexus.  Appalling!  As thought paying for something would reduce our alienation from our species-being rather than embodying it!  It's in the 1844 manuscripts people!!!

Console yourself that with each breath, you likely inhale some of the same molecules that Mr. Dylan inhaled just before he sang "Blowin' in the Wind" for the first time.  By paying for his signature, you might as well be breathing in molecules Mr. Dylan exhaled during the recording of "Idiot Wind."  Better than either option, you can get a whiff of Dylan's aura at the Dylan Archives in Tulsa.  I plan a pilgrimage soon, even though I reside firmly on the post-Weberian side of disenchantment.

That said, I was thinking about art and aura when I saw Bob Dylan live.  The stage was crowded.  I heard him before I could pick him out, in the (I assume intentionally) one dark patch of an otherwise carefully illuminated mis-en-scene.  The voice was unmistakable.  Bob Dylan was there, singing an unrecognizable version of a recognizable song.  And so it would continue for ninety minutes or so.  Eventually I found him, hunched over a keyboard, looking down at his lyrics, harmonica at the ready, and I was enchanted.

 

November 30, 2022 in Books, Celebrity Contracts, Commentary, Current Affairs, In the News, Music | Permalink | Comments (0)

Tuesday, November 1, 2022

Adidas Terminates Agreement with Kanye West (Ye) over Anti-Semitic Comments

Kanye_West_at_the_2009_Tribeca_Film_Festival_(cropped)Adidas has a line of shoes branded "Yeezy," a brand associated with Kanye West, who now goes by Ye (right).  According to and  of the Washington Post the brand generated $2 billion in revenue last year and accounts for nearly ten percent of Adidas' annual revenue.  The end of the contract will be costly to Ye, but Adidas estimates that it will also cost the company about $250 million.  Adidas is the last domino to fall.  Numerous other companies had already severed ties with Ye. 

None of the articles that I have looked at discuss the basis for terminating the deals.  One expects that the contracts have morals clauses, but one would like to have a look at them to see whether Ye's partners have discretion to invoke them selectively.  As discussed below, his anti-Semitic outbursts are not the first occasion that might have given corporate partners concerns about how Ye's conduct reflected on the product.  To date, I haven't seen anything suggesting that Ye was challenging the companies' rights to termination his deals.  

Earlier, Ye's social media accounts were restricted in connection with statements viewed to be anti-Semitic.  Ye responded, according to media accounts, by entering into a preliminary agreement to buy Parler, a social media platform that promotes itself as more amenable to unbridled freedom of expression than its mainstream rivals.  

The Washington Post provides many reasons why Adidas might have been willing to bid auf wiedersehen to Ye.  He was not easy to work with, to say the least, and his recent barrage of provocative speech is not his only brush with controversy.  The Post speculates that, shunned by the fashion industry, Ye might fall back on music to keep his empire afloat.  But there is also the danger that the major music platforms will also refuse to distribute his products.  

That seems unlikely to me.  It's not as if Ye supporters are in it for the anti-Semitism, but as of CNN reports, many have noticed that corporate partners did not sever ties with Ye when he made statements that could be construed as anti-Black, such as when he donned a "White Lives Matter" t-shirt, called slavery a "choice," and decried racism as "a dated concept."  Those who were willing to stick with Ye despite his anti-Black expression and expressive conduct would likely continue to do so notwithstanding his anti-Semitism.

David_Bowie_Chile Blind FaithDoing so, in my view, would not make them complicit in Ye's anti-Semitism.  Most of his fans dislike his anti-Semitism, but many would overlook it because of his unique attributes as an artist.  I'll admit it, when I recently learned that Eric Clapton (far right, with Blind faith) had expressed support for Enoch Powell's British fascism, and that David Bowie (left) had expressed unseemly enthusiasm for Hitler and the Third Reich, it had no effect on my enjoyment of Layla or Changes.  I forgive them their trespasses or their not-so-youthful indiscretions or whatever made these wonderful musicians say such stupid things.  Our broken world is full of broken people, including broken artists.  Sometimes, it is more appropriate to respond with compassion than with judgment.

November 1, 2022 in Celebrity Contracts, Current Affairs, In the News, Music | Permalink | Comments (0)

Monday, September 19, 2022

Follow-up on Former Nebraska Coach Scott Frost's Contract

Scott_Frost_in_Black_Nebraska_Shirt_(cropped)
By Huskerdood - Own work, CC BY-SA 4.0

Last week, we posted about Nebraska's decision to fire its head football coach Scott Frost and pay him $15 million in severance.   Victor Goldberg shared Coach Frost's contract and its two addenda, with me.  You can also find it online here.

One big takeaway from Professor Goldberg's work is that sophisticated parties fashion their own remedies, and those remedies often depart from the default rules set out in the common law.  So too in the realm of coaching contracts.  You might think that a coach who gets a $15 million severance package for early termination of his contract would have to mitigate should he land comparable employment at another school.  Not so here.

As Professor Goldberg notes after reviewing the contracts in his comment here, Coach Frost's initial Dec. 2017 contract provided that, while he had no obligation to mitigate, if he got another coaching job, either in the NFL or with another Division I NCAA team, the severance pay (termed "Liquidated Damages") would be offset (set forth in Section 13(b) of the original agreement).  But the addenda provided for neither a duty to mitigate nor an offset (in paragraph 2 of the 2021 addendum and paragraph 3 of the 2019 addendum).  

The mystery to me is why the addenda, negotiated after Coach Frost and Nebraska football suffered through several losing seasons, would be more generous than the original contract, negotiated when Coach Frost was the hottest coach on the market.  One would have to review the contracts as whole to determine what Coach Frost gave up in exchange for more generous liquidated damages provisions.

September 19, 2022 in Celebrity Contracts, Sports, True Contracts | Permalink | Comments (0)

Thursday, September 15, 2022

The Case of the Nebraska Football Coach's Buyout

Scott_Frost_in_Black_Nebraska_Shirt_(cropped)
By Huskerdood - Own work, CC BY-SA 4.0

You have to be an extraordinary person to be an elite college football coach.  You must be unusually savvy about contracts.  That must be true, because I know a lot about contracts but I can't make any sense of the incentive structures in the contract of former Nebraska head coach Scott Frost (right).  Andrew Doughty of BetMGM has the numbers here.

Coach Frost had an extraordinary second season, leading the University of Central Florida to an undefeated campaign and defeating Auburn in the Peach Bowl.  Nebraska paid $3 million to buy out his contract and then agreed to a seven year, $35 million contract with Coach Frost.  Two dismal years in, the contract was extended through 2026.  After two more dismal years, Nebraska and Coach Frost renegotiated his contract, reducing his annual salary to a miserly $4 million/year.  The buyout structure is complicated, but in the end, Coach Frost is entitled to a $15 million buyout.  If the team had waited until October to buy him out, it would have owed only $7.5 million.  

You might think that Nebraska is not really out that $15 million because Coach Frost has a duty to mitigate.  Except that I seem to recall reading somewhere in  Victor Goldberg's  Rethinking Contract Law and Contract Design that coaches' contracts often specify that there is no duty to mitigate [if someone can find the cite or knows from some other source, please chime in].  Moreover, Coach Frost's record at Nebraska was 16-31 overall, 10-26 against conference opponents, and the team was winless against ranked teams.  When Nebraska landed Coach Frost, he was the most sought-after young coach in college football.  Now, he's asking Kramer's question after a prolonged cigar binge:

Why, you might ask, did Nebraska not wait until October?  Some sportswriters speculate that the timing was dictated by an upcoming game against the Oklahoma Sooners.  Nebraska's athletic director did not want to see his team humiliated by the team he played for.  One would think that even rabid Nebraska football fans would not think that motivation justified a $7.5 million price tag.  But there are other reasons that would surely pass a business-judgment-rule type sniff test.  It seems there are advantages to being the first in the pool when it comes to picking a new head coach.

Has Nebraska learned its lesson?  Coach Frost's resume shows that past performance is no guarantee of future success.

September 15, 2022 in Celebrity Contracts, Commentary, In the News, Sports, True Contracts | Permalink | Comments (3)