Filed: Apr. 11, 2011
Latest Update: Feb. 22, 2020
Summary: UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 09-1825 TRADEMARK PROPERTIES INCORPORATED, a South Carolina Corporation; RICHARD C. DAVIS, an Individual, Plaintiffs - Appellees, v. A&E TELEVISION NETWORKS, a Joint Venture of the Hearst Corporation; DEPARTURE FILMS, an Entity of Unknown Origin, Defendants – Appellants, and ABC, INCORPORATED; NBC UNIVERSAL; DOES 1-20, Inclusive, Defendants. Appeal from the United States District Court for the District of South Carolina, at Ch
Summary: UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 09-1825 TRADEMARK PROPERTIES INCORPORATED, a South Carolina Corporation; RICHARD C. DAVIS, an Individual, Plaintiffs - Appellees, v. A&E TELEVISION NETWORKS, a Joint Venture of the Hearst Corporation; DEPARTURE FILMS, an Entity of Unknown Origin, Defendants – Appellants, and ABC, INCORPORATED; NBC UNIVERSAL; DOES 1-20, Inclusive, Defendants. Appeal from the United States District Court for the District of South Carolina, at Cha..
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 09-1825
TRADEMARK PROPERTIES INCORPORATED, a South Carolina
Corporation; RICHARD C. DAVIS, an Individual,
Plaintiffs - Appellees,
v.
A&E TELEVISION NETWORKS, a Joint Venture of the Hearst
Corporation; DEPARTURE FILMS, an Entity of Unknown Origin,
Defendants – Appellants,
and
ABC, INCORPORATED; NBC UNIVERSAL; DOES 1-20, Inclusive,
Defendants.
Appeal from the United States District Court for the District of
South Carolina, at Charleston. C. Weston Houck, Senior District
Judge. (2:06-cv-02195-CWH)
Argued: October 27, 2010 Decided: April 11, 2011
Before KING and DUNCAN, Circuit Judges, and Bobby R. BALDOCK,
Senior Circuit Judge of the United States Court of Appeals for
the Tenth Circuit, sitting by designation.
Affirmed by unpublished opinion. Senior Judge Baldock wrote the
majority opinion, in which Judge King joined. Judge Duncan
wrote a separate opinion dissenting from the judgment.
ARGUED: Michael B. Mukasey, DEBEVOISE & PLIMPTON LLP, New York,
New York, for Appellants. William Walter Wilkins, NEXSEN PRUET,
Greenville, South Carolina, for Appellees. ON BRIEF: Jeremy
Feigelson, S. Zev Parnass, DEBEVOISE & PLIMPTON LLP, New York,
New York; Richard Ashby Farrier, Jr., Robert H. Jordan, NELSON
MULLINS RILEY & SCARBOROUGH LLP, Charleston, South Carolina, for
Appellants. Kirsten E. Small, NEXSEN PRUET, Greenville, South
Carolina, for Appellees.
Unpublished opinions are not binding precedent in this circuit.
2
BALDOCK, Senior Circuit Judge:
Plaintiff Richard C. Davis approached Defendant A&E
Television Networks with the concept that he maintains became
the reality television series “Flip This House.” 1 This dispute
arises out of the parties’ disagreement over an alleged oral
agreement to split equally net revenues of the show. Plaintiff
sued Defendant in state court for breach of that oral contract
in 2006, demanding approximately $7.5 million in damages, i.e.,
half of the net revenues from the three seasons that had
completed filming prior to trial. 2 Defendant successfully
removed the case to federal court on the basis of diversity
jurisdiction. After five days of trial in South Carolina
federal district court, a jury returned a verdict awarding
Plaintiff a little over $4 million, essentially half of the
first season’s net revenues. The district court subsequently
denied Defendant’s motions for judgment as a matter of law and a
new trial pursuant to Fed. R. Civ. P. 50(b) and Fed. R. Civ. P.
59, respectively. Defendant argues we should reverse and direct
judgment in its favor because the evidence was legally
1
Plaintiff Davis incorporated Plaintiff Trademark
Properties, Inc. as part of his real estate business. While
both are Plaintiffs in this suit, for simplicity’s sake we refer
to Davis as Plaintiff.
2
The parties refer to “net profits” and “net revenues”
interchangeably. As a result, so do we.
3
insufficient to support a finding of an oral contract under New
York law or, alternatively, order a new trial because of claimed
errors in jury instructions and evidentiary rulings. We exercise
our appellate jurisdiction provided by 28 U.S.C. § 1291. After
careful review of the record submitted on appeal, we affirm the
district court’s denial of Defendant’s motions for judgment as a
matter of law and a new trial.
I.
We review the district court’s denial of Defendant’s Rule
50(b) motion for a judgment as a matter of law de novo. Sloas
v. CSX Transp. Inc., 616 F.3d 380, 392 (4th Cir. 2010). In
conducting that review, we ask “‘whether there was a legally
sufficient evidentiary basis for a reasonable jury, viewing the
evidence in the light most favorable to the prevailing party, to
find for that party. If reasonable minds could differ about the
verdict, we are obliged to affirm.’” King v. McMillan,
594 F.3d
301, 312 (4th Cir. 2010) (quoting ABT Bldg. Prods. Corp. v.
Nat’l Union Fire Ins. Co.,
472 F.3d 99, 113 (4th Cir. 2006))
(internal citations omitted); see also Fed. R. Civ. P. 50(a)(1)
(providing a court may grant a party judgment as a matter of law
if “a reasonable jury would not have a legally sufficient
evidentiary basis to find for” the nonmoving party). We review
the entire record, “disregard[ing] all evidence favorable to the
4
moving party that the jury is not required to believe.” Reeves
v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 151 (2000).
II.
Given that standard of review, we have gleaned and so
present the following facts necessary to explain our holding.
Plaintiff is a South Carolina real estate broker who buys
underpriced properties to renovate and sell, engaging in a
process we are told is commonly known as “flipping.” In 2003,
Plaintiff conceived of the idea of a television show to document
the flipping process and later developed a pilot episode of the
show. In 2004, Plaintiff submitted the pilot to multiple
television networks, including Defendant. Defendant’s vice
president directed him to deal with Charles Nordlander, director
of lifestyle programming for Defendant.
After Nordlander viewed the pilot, the two spoke over the
phone for a little less than an hour on June 3, 2004 about
turning the show into a series. Essentially, Plaintiff proposed
that he would assume all of the financial risk relating to the
purchase and resale of the real estate but that they would
otherwise equally split the net revenues of the television show.
In response to Plaintiff’s offer, Plaintiff maintains Nordlander
said “Okay, okay, I get it.” Thus, Plaintiff argues that by the
end of this June 3 telephone conversation he and Defendant, via
5
Nordlander, had entered into an oral contract to produce a
television series based on Plaintiff’s pilot and to share all
resulting net revenues equally, subject to approval by
Defendant’s board of directors.
Plaintiff testified that Nordlander arranged a conference
call shortly thereafter during which Plaintiff confirmed the
terms of the contract with three other representatives of
Defendant. Nordlander also arranged a meeting in New York on
June 14 between a production company, Departure Films, and
Plaintiff. With Departure Films on board, filming for the pilot
began in August 2004. In March 2005, Defendant’s Senior Vice
President e-mailed Plaintiff that “[t]he board approved the
money for our series.” Plaintiff and Departure Films then began
filming season one.
The parties never reduced any oral agreement to writing.
Nonetheless, they filmed thirteen episodes of “Flip this House.”
By all accounts, the show was a commercial success. But, as
must be the case since the parties came knocking on the Court’s
door, their business relationship fell apart in 2006. The
parties could not resolve the matter of Plaintiff’s
compensation. Defendant offered to pay Plaintiff an appearance
fee per episode and a five percent share of incremental revenue
attributable to the show. Plaintiff rejected that offer and
signed a talent agreement with another television network.
6
Defendant went on to produce three more seasons of “Flip this
House” without Plaintiff’s participation. Defendant never paid
Plaintiff any money, let alone half of the series’ net revenue,
for his role in its production. At trial, Defendant denied ever
entering into any contract with Plaintiff.
III.
We start by setting forth the principles of contract law
relevant to Defendant’s claim that it is entitled to judgment as
a matter of law. “[B]ecause the matter is before us in
diversity, we are bound by the applicable state substantive
law.” Benner v. Nationwide Mut. Ins. Co., 93 F.3d 1228, 1234
(4th Cir. 1996). And, because neither party contests the
district court’s ruling that New York law controls, we apply the
laws of New York.
Absent prohibition by the statute of frauds, oral contracts
are just as binding as written contracts under New York law. 3
Stein v. Gelfand, 476 F. Supp. 2d 427, 431 (S.D.N.Y. 2007). To
establish Defendant breached their oral contract, Plaintiff
must, of course, first prove that they formed such a contract.
Cleveland Wrecking Co. v. Hercules Constr. Corp.,
23 F. Supp. 2d
3
Defendant does not raise the statute of frauds as a
defense on appeal.
7
287, 292 (E.D.N.Y. 1998). “‘To form a valid contract under New
York law, there must be an offer, acceptance, consideration,
mutual assent and intent to be bound.’” Register.com, Inc. v.
Verio, Inc., 356 F.3d 393, 427 (2d Cir. 2004) (quoting Louros v.
Cyr,
175 F. Supp. 2d 497, 512 n.5 (S.D.N.Y. 2001)). “‘[M]utual
assent is essential to the formation of a contract and a party
cannot be held to have contracted if there was no assent or
acceptance.’”
Id. (quoting Maffea v. Ippolito,
668 N.Y.S.2d
653, 654 (N.Y. App. Div. 1998)). “There must, in other words,
be ‘an objective meeting of the minds sufficient to give rise to
a binding and enforceable contract.’” Int’l Bus. Mach. Corp. v.
Johnson, 629 F. Supp. 2d 321, 330 (S.D.N.Y. 2009) (quoting
Tractelbel Energy Mktg., Inc. v. AEP Power Mktg., Inc.,
487 F.3d
89, 95 (2d Cir. 2007)), aff’d, 355 F. App’x 454 (2d Cir. 2009).
The same is true whether the parties formed the contract orally
or with the written word. However, where an alleged contract is
oral, the party asserting its enforceability bears an even
heavier burden of proving more than agreement on or acceptance
of all material terms, but also overall agreement to be bound by
the oral agreement without a writing. When the alleged contract
is oral, “[m]ore is needed than agreement on each detail [to
create a binding obligation. There must be] overall
agreement . . . to enter into the binding contract.” N.F.L.
Ins. Ltd. by Lines v. B&B Holdings, Inc.,
874 F. Supp. 606, 613
8
(S.D.N.Y. 1995) (addition in original) (internal quotations and
citations omitted)); see also Shaftel v. Dadras, 39 F. Supp. 2d
217, 226 (E.D.N.Y. 1999) (detailing the four-factor test New
York law employs to discern whether parties intended to be bound
by their oral agreement without a writing), aff’d 78 F. App’x
169 (2d Cir. 2003). 4
“Generally, courts look to the basic elements of the offer
and the acceptance to determine whether there is an objective
meeting of the minds sufficient to give rise to a binding and
4
Defendant makes much of the following text from an
unpublished decision, suggesting it represents a unique and
stringent standard for proving the existence of oral contracts
under New York law: “But, despite any multi-factor inquiry [as
to whether the parties intended to be bound without a writing],
if the Court finds substantial ambiguity regarding whether both
parties have mutually assented to all material terms, then the
Court can neither find, nor enforce, a contract.” Barbarian
Rugby Wear, Inc. v. PRL USA Holdings, Inc., No. 06 Civ.
2652(JGK), 2008 WL 5169495, at *3 (S.D.N.Y. Dec. 9, 2008). The
citations Barbarian provides for support of that statement,
however, make clear that the statement is simply another way of
saying the following basic precepts of oral and written contract
law: “If an agreement is not reasonably certain in its material
terms, there can be no legally enforceable contract,” Missigman
v. USI Ne., Inc.,
131 F. Supp. 2d 495, 506 (S.D.N.Y. 2001), and
“To create a binding contract, there must be a manifestation of
mutual assent sufficiently definite to assure that the parties
are truly in agreement with respect to all material terms,”
Express Indus. & Terminal Corp. v. Dep’t of Transp.,
715 N.E.2d
1050, 1053 (N.Y. 1999). We discuss the definiteness of
Defendant’s acceptance and the agreement’s material terms,
infra. But because we need not consider the definiteness of the
agreement’s material terms if we determine Defendant did not
manifest acceptance at all (which is hotly disputed), we begin
by evaluating whether Nordlander expressed acceptance to
Plaintiff’s offer.
9
enforceable contract.” Express Indus., 715 N.E.2d at 1053.
“The first step” in that analysis requires a court “to determine
whether there is a sufficiently definite offer such that its
unequivocal acceptance will give rise to an enforceable
contract.”
Id. But, even assuming Plaintiff’s offer was
sufficiently definite, Defendant maintains Plaintiff’s assertion
of its acceptance of his offer was not. We therefore move to
the next step in the mutual assent analysis: acceptance.
As long as the offer does not dictate otherwise, “oral
acceptance of an offer is valid.” 22 N.Y. Jur. 2d Contracts
§ 45. Parties may also manifest the “‘assent necessary to form a
contract . . . by . . . act, or conduct which evinces the
intention of the parties to contract.’” Register.com, 356 F.3d
at 427 (quoting
Maffea, 668 N.Y.S.2d at 654)). Plaintiff
accordingly asked the district court to instruct the jury that
“a contract is an obligation which arises from actual agreement
of the parties, manifested by words, oral or written, or by
conduct.” Supp. J.A. at 2. The district court, however,
refused to give that instruction, concluding the trial had
revealed no “conduct . . . that could be interpreted as
constituting an acceptance by the [D]efendant of any offer made
by [Plaintiff] so as to make a contract.”
Id. at 4. Instead,
the court instructed the jury that “[a] contract is an
obligation which arises from actual agreement of the parties,
10
manifested by words, oral or written.” J.A. at 559—60. On
appeal, Plaintiff neither challenges the district court’s ruling
and subsequent instruction nor contends that Defendant accepted
his offer by conduct. To the contrary, Plaintiff contends
“Nor[d]lander agreed to the terms [of his offer], saying, ‘Okay,
okay, I get it.’” Aple. Resp. Br. at 6 (quoting J.A. at 258);
see also id. at 19 (“[Plaintiff] specifically testified that
Nor[d]lander agreed to the terms, saying, ‘Okay, okay, I get
it.’”). 5 Because Plaintiff has evidently abandoned his claim that
Defendant accepted his offer by virtue of its conduct, we must
decide only whether a reasonable jury could conclude from the
trial evidence that Defendant accepted Plaintiff’s offer through
5
Plaintiff does not fail to mention the parties’ conduct
altogether. In his brief, Plaintiff argues “[t]he parties’
nearly complete performance of their respective obligations
under the contract . . . is likewise ‘of major significance.’”
Aple. Resp. Br. at 28 (quoting R.G. Group, Inc. v. Horn &
Hardart Co., 751 F.2d 69, 75 (2d Cir. 1984)). But he contends
that the parties’ performance is of “‘major significance’” to
“the determination of whether the parties intended to be bound
in the absence of a written agreement[,]” not to the
determination of whether the parties had reached an oral
agreement in the first place, i.e., whether Nordlander or
Defendant accepted Plaintiff’s offer. Aple. Resp. Br. at 27
(citing R.G.
Group, 751 F.2d at 75—76 (detailing four factors
New York courts use to decide whether “the parties’ words and
deeds, within a given bargaining context, show an intent to be
bound only by a written agreement.”)). Plaintiff must first
clear the hurdle of demonstrating Defendant assented to his
offer in order to reach the issue of whether the parties’
intended to be bound by their oral agreement without a written
document.
11
oral or written words. See King, 594 F.3d at 312 (explaining
the standard of review of a district court’s denial of a Rule 50
motion).
Generally, “in order for an acceptance to be effective, it
must comply with the terms of the offer and be clear,
unambiguous and unequivocal.” King v. King, 617 N.Y.S.2d 593,
594 (N.Y. App. Div. 1994); see also 2 Williston on Contracts
§ 6:10 (4th ed. 2007) (“As a general principle, at common law an
acceptance, in order to be effective, must be positive and
unambiguous.”). When an offeree communicates “an acceptance
[that] is ambiguous or equivocal—that is, an acceptance that a
reasonable person could view as assent, rejection, or an
invitation to bargain further . . . it is the offeror’s reaction
to that ambiguous acceptance that controls whether the parties
have entered into a contract.”
Johnson, 629 F. Supp. 2d at 330.
[B]y their nature, equivocal responses are capable of
being understood either as the offeree apparently
intends them . . . or as the offeror might apparently
understand them. . . . To the extent that either
interpretation is plausible, the offeree can hardly
complain if the offeror understands the communication
as the offeree apparently intended; and the offeror
who reasonably treats an equivocal response as an
acceptance may hold the offeree to a contract. This
rule . . . operates to protect the offeror who acts
reasonably in relation to what it supposes is intended
to operate as an acceptance, yet provides the offeror
with significant flexibility as the master of the
offer. In short, how the offeror treats the offeree’s
language will, assuming that treating the language
either as language of acceptance or treating it as
12
language requiring further discussion is reasonable,
determine the language’s effect.
Id. at 330—31 (quoting 2 Williston on Contracts § 6:10 (4th ed.
2004)). So long as the offeror’s interpretation of the
offeree’s equivocal acceptance is plausible or reasonable, New
York courts will find a contract has been formed. “In other
words, where an offeree communicates an ambiguous acceptance,
the offeree must assume the risk of the offeror’s
misinterpretation.”
Id. at 331.
As Judge Learned Hand once explained: “‘A contract has,
strictly speaking, nothing to do with the personal or individual
intent of the parties. A contract is an obligation attached by
mere force of law to certain acts of the parties, usually words,
which ordinarily accompany and represent a known intent.’”
S.S.I. Investors Ltd. v. Korea Tungsten Min. Co., Ltd., 438
N.Y.S.2d 96, 100 (N.Y. App. Div. 1981) (quoting Hotchkiss v.
Nat’l City Bank,
200 F. 287, 293 (S.D.N.Y 1911)), aff’d by
434
N.E.2d 242 (N.Y. 1982). Therefore, ours is an objective
inquiry. We do not care about the “parties’ after-the fact
professed subjective intent.” Cleveland Wrecking,
23 F. Supp.
2d at 292 (internal quotations omitted). Rather, in deciding
whether parties have reached an agreement, we must look to the
parties’:
[O]bjective intent as manifested by their expressed
words and deeds at the time. . . . In determining
13
whether the parties entered into a contractual
agreement and what were its terms, “disproportionate
emphasis is not to be put on any single act, phrase or
other expression, but, instead, on the totality of all
of these, given the attendant circumstances, the
situation of the parties, and the objectives they were
striving to attain. . . .”
Id. (quoting Reprosystem, B.V. v. SCM Corp.,
522 F. Supp. 1257,
1275 (S.D.N.Y. 1981)). Therefore, “[w]hether an acceptance is
ambiguous or equivocal . . . depends not on the subjective,
undisclosed intent of the offeree, but rather on the offeree’s
words and actions as viewed from the perspective of a reasonable
person.”
Johnson, 629 F. Supp. 2d at 330.
Finally, we must also note that “‘[w]hile the existence of
a contract is a question of fact, the question of whether a
certain or undisputed state of facts establishes a contract is
one of law for the courts.’” Gui’s Lumber & Home Ctr., Inc. v.
Mader Constr. Co., Inc., 787 N.Y.S.2d 555, 556 (N.Y. App. Div.
2004) (quoting Cortland Asbestos Prods. v. J. & K. Plumbing &
Heating Co.,
304 N.Y.S.2d 694, 696 (N.Y. App. Div. 1969)). More
specifically, “questions as to what the parties said, what they
intended, and how a statement by one party was understood by the
other are questions of fact; however, the matter of whether or
not there was a contract, in light of the factual findings on
these questions, is an issue of law.” Ronan Assocs. v. Local
94-94A-94B,
24 F.3d 447, 449 (2d Cir. 1994) (citing Four Seasons
14
Hotels, Ltd. v. Vinnik, 515 N.Y.S.2d 1, 6 (N.Y. App. Div.
1987)).
A.
Defendant argued in its Rule 50(b) motion before the
district court that Plaintiff had failed to provide any evidence
of Defendant’s assent. The district court did not see it that
way, explaining:
[I]n [Plaintiff’s] testimony he says clearly and
unequivocally that Mr. Nordlander accepted those
terms, and that he reached an oral contract with the
[D]efendant which incorporated those terms that he has
stated. He was asked, “. . . did Charles Nordlander
ever say to you, did he in plain English say, yes,
sir, I agree [Defendant] will share 50 percent of its
profits? Answer: Absolutely he did. Absolutely.”
There are statements like that throughout the record,
where he said he told Mr. Nordlander what he
wanted. . . . I think that testimony where he says he
made the proposal to [D]efendant, and Mr. Nordlander
accepted it and agreed to it absolutely, indicates
that the parties did have a meeting of the minds, they
did reach a contract, as stated from the portions of
the record I just quoted, and that [D]efendant
breached that contract, because they did not pay to
[P]laintiff the compensation therefore that they
agreed to pay.
J.A. at 526–28 (quoting J.A. at 253—54).
On appeal, Defendant argues that Plaintiff’s testimony that
the district court relied upon (quoted above) constitutes
conclusory assertions as to the legal meaning, or his own
subjective interpretation, of Nordlander’s statements during the
June 3 phone call. As a result, Defendant asserts such
testimony cannot be relied upon to determine what it is
15
Nordlander actually said and whether any such statement
objectively constitutes assent to Plaintiff’s offer. Despite
Plaintiff’s repeated declaration that he and Nordlander had an
agreement, Defendant claims that the only specific words of
acceptance Plaintiff at trial ever attributed to Nordlander were
“Okay, okay, I get it.” Defendant contends that statement does
not constitute unambiguous acceptance because it conveys at most
that Nordlander understood the terms of the offer, not that he
accepted the offer on behalf of Defendant. So, Defendant
maintains a contract was never formed.
Context matters—a saying as old as time because it is true.
Because we must view the evidence in the light most favorable to
Plaintiff, we start with Plaintiff’s evidence of the context of
the June 3 phone conversation. According to Plaintiff’s
testimony, he and Nordlander discussed the pilot and making it
into a series:
A: And then [Nordlander] said, “All right, Richard,”
basically you know, “Can you do this again?” . . . .
And I said, “Charles it’s not for sale.” And he said,
“How much do you have in it?” And I went through the
same thing again. “I’ve got 85,000 in it.” . . . .
His job is—I assumed was to acquire the show, because
he said, “How much do you want?” And I said, “Charles,
this is not for sale.”
***
A. And at one point, we started talking numbers, and
he was talking about what—you know, how much did that
house go for, how much did I spend, and at the time I
remember projecting—his concern was that to make sure
that that partnership was fair, and he was saying,
“How much do you think you are going to spend?” And
16
the rough numbers that I remember was basically you
know, they are going to have about $2 million in it,
and that, you know, they want to make sure that I
didn’t, you know, come in on the light end. . . .
But, you know, my rough estimate was that I was going
to spend about $4 million . . . .
Id. at 147, 156—57. The two agreed Defendant would hire a New-
York based, third-party production company to film future
episodes:
A: And [Nordlander] said, . . . “I’m having a hard
time getting these guys to let you—we like to have
production companies that are right here that are real
close that are in New York. . . . I’ve got a company—
there is two or three companies I want you to talk to.
These guys are working on something for me right now.
They are editors from HBO, and that’s what they do.”
***
So anyway, we started talking about how we were going
to engage a third-party production company, and you
know, threw out, like I said, a couple of names, and
he wanted me to meet these guys and talk with them.
Id. at 148, 150. They discussed the series’ revenues.
Plaintiff stated his belief that he thought the show would be
profitable, but Nordlander disagreed:
A: But in this situation, it was, “Charles, it’s not
for sale. I own this thing. I have been—you know, I
was told by somebody that this thing could make
money.” And Charles said, “Richard, don’t take this
the wrong way. Y’all did a really good show, but
these kind of shows . . . don’t make money.”
Id. at 149. Nordlander also explained that Defendant would not
accept any risk of the real estate aspect of the series.
Q. Did you reach agreement concerning the real estate,
the risk associated with acquiring and refurbishing
real estate?
17
A. Absolutely. It was very firm from him that I was
100 percent on my own on that, that A&E would not have
any of the risk, any liability. It wouldn’t be on
deeds. It had nothing to do with that. It was
clearly, totally separate, and they did not want any
of the liability, any financial obligation of the risk
with that.
Id. at 156. “[Plaintiff] assured Nor[d]lander that [Defendant]
would bear none of the financial risk (or reward) relating to
the purchase and resale of the real estate.” Aple. Resp. Br. at
4. Taking into account that concern, Plaintiff made the
following proposal:
A. And, I said, “Charles, look, I’m a big boy. . . .
I’ll take that risk. But here’s the deal. I will
share revenue with you on this. This is my show.
I’ll do all the real estate . . . . All that risk is
on me. I’ll buy all the properties. I’ll put all the
employees on it. I will pay for everything. I’ll do
every bit of that.” And then, you know, he talked
about the production, how much I had into it. I told
him 85,000, and he said it was unrealistic, that we
probably had costs in there that we didn’t take into
account . . . but . . . if we were going to have a
shot at this, and was going to be successful, then we
had to keep the production costs down. And I don’t
recall the exact number, but I know it was below
$150,000. . . . He said if we can keep that below
there.
Id. at 150. “Under the proposed arrangement, [Defendant] would
bear the cost of producing the show, and [Plaintiff] would track
his out-of-pocket expenses related to production of the show. At
the end of the season, the parties would subtract their expenses
from the show[’]s revenues and evenly divide any surplus.”
Aple. Resp. Br. at 5.
18
Q. Did you reach an agreement as to who was going to
front the production costs?
A. Yeah. They—he actually called them in-house . . . but
he said he would take care of his in-house guys and I would
take care of stuff in the field, that basically, we would
have this production company at our disposal.
Q. Okay. Did you reach an agreement with him
concerning the production of the show?
A. Absolutely, we did.
Q. Okay. What was the terms of the agreement?
A. I was very forward. At this point I had nothing to
lose. And I said, “Charles the show is not for sale. I
will—I will partner this with you. We will split revenue.
I will pay for my side. . . . Let’s keep track of
expenses, and then we chop it up in the middle, and then if
it makes money, we split it. If it doesn’t make money, I’m
a big boy, I don’t need anything out of it, and you know, I
just don’t make it.”
***
Q. Okay. Let’s go back through one at a time. Did you
reach an agreement about anything relative to the
production cost of the show?
A. Absolutely. Those guys—we would hire a third-party
production company. They’d keep track of cost. They would
front it, they would pay for it. And then at the end,
whatever the cost would be, you know, we come out—and I
remember hesitating, thinking, I stood for 85,000, he’s
putting 150 in there, if I could do what I can to keep that
number down, we would come up better.
Q. Did you reach an agreement concerning your production
costs?
A. Yeah. He basically said, “You keep track of it.” . . .
I would keep track of my out-of-pocket expenses, and I will
throw that in at the end, my expenses, his expenses on the
actual production of the show.
And then . . . once . . . everybody paid their expenses
. . . if it didn’t make any money, I didn’t get
anything . . . .
J.A. at 150—51, 155—56.
Nordlander responded to Plaintiff’s proposal by warning
Plaintiff again that shows of this kind do not make money. So
they discussed how they could get this show to make money.
19
Q. How did he respond to that?
A. Well, he went through a couple of different things.
He talked about shows not making money. . . . So we
were kicking around different, different ideas on
that, as far as how we could go out and generate, and
make money on a show that he just told me these shows
don’t make money.
***
Q. Did you discuss with him how you were going to get
revenue for the show?
A. Yeah. The different things between advertising and
sponsors, and that we would, you know, collectively
come up with a list of things that we felt that we
could go out and generate money for this show,
specifically.
Id. at 151—52, 158. “[Plaintiff] then provided Nor[d]lander
with an illustration of these terms in the form of a lengthy
recounting of a deal he had made with an investor in a hotel
project.” Aple. Resp. Br. at 5.
Q. All right. Can you go over for me what the terms
of the agreement were?
A. Yeah. It was very simple. I actually used an
example . . . I told him . . . “Charles, look, I’m a
real estate guy. . . . [I]f I’m brokering the deal, I
take a commission . . . . I used an example, I bought
a hotel years ago in Mount Pleasant. I bought it out
at a foreclosure sale, and I bought it for $2.1
million. . . . So I called this gentleman up . . . .
And I said, “You know, if you can give me the money,
you know, I will take care of everything on my side,
I’ll buy it, I’ll fix it up and sell it, we split the
profits.”
***
A. And I said, “So, Charles, just to show you what a
good partner I am, on doing deals, here is what
happens.” We needed $2.1 million. I only needed five
percent. The next day, I went and bid on the
property. I got it. I needed my five percent. He
wired it down. . . . And so he had obligated, he was
committed, fully ready, willing and able to send me
down 2.1 million. I ended up not even having to take
it. We took our piece of paper and we sold our
20
position to Red Roof Inn. . . . I said, “We took
that, we took the profits, we paid our expenses.” We
had . . . seven or eight checks that we paid expenses
first, and then we took what was left over and we
chopped it in half, and he got his check and I got
mine. And used that as an example for Charles.
Id. at 153—55. Nordlander reiterated his concern that
Plaintiff’s proposal might not be beneficial for Plaintiff.
A. And Charles was concerned for me that this show was
not going to make any money, and I was going to end up
with nothing, and that I ought to take a sure thing,
and I said, “Nope, that’s not what I’m doing. I’m not
selling the rights to my show.” Very firm. . . . I
went into a long drawn-out example of exactly how to
split it.
J.A. at 155. “Nor[d]lander agreed to the terms, saying, ‘Okay,
okay, I get it,’ although he remained concerned that the
agreement was not fair to [Plaintiff].” Aple. Resp. Br. at 5—6.
This statement by Nordlander is discussed in greater detail,
infra. They also discussed credits for the series.
Q. Did you reach any agreement with him concerning
about credits, relative to the series?
A. We did. Because he talked about the pilot. He
looked at it, and right when it played on the pilot,
the very first line up there said, executive producer,
Richard C. Davis.
And he told me, tiptoed around it and was saying,
“Look, you know, that’s not going to go. . . . [W]e
are going to get them some cheap labor, because we are
going to give them a credit. They are going to be the
producers. You are going to be the creator.”
And I said, “Fine with me. Absolutely. No problem.”
J.A. at 157. So, according to Plaintiff, by the end of their
June 3 phone conversation he and Nordlander had formed a
21
contract to make a television series based upon his pilot and
split the resulting profits equally.
Q. Did you reach agreement with Charles Nor[d]lander
to split revenue?
A. Absolutely. We reached an agreement on splitting
revenue. He—I felt he was genuinely concerned that I
was cutting a bad deal.
Q. What was the split on revenue?
A. It was right down the middle, 50/50. You take your
half, I’ll take my half.
Id. at 157—58.
On cross examination, Plaintiff testified Nordlander
specified one condition on the agreement going into effect—
approval by Defendant’s board of directors.
Q. Mr. Davis, there was no commitment by A&E in that
phone call to actually make a television show?
A. No, sir. It was contingent on board approval.
Q. There was no agreement in the phone call to
actually make a television show, correct, sir?
A. It was an agreement, yes, sir.
Q. There was no agreement to actually make the
television show, correct, sir?
A. Yes, sir.
Q. Yes, there was no agreement?
A. I see what you are saying. Yes, sir.
Id. at 248. Plaintiff also explained exactly what Nordlander
said in the phone conversation that led him to believe
Nordlander had said “in plain English” that Defendant, pending
board approval, would make the proposed television show and
split the resulting profits equally.
Q. Mr. Davis, did Charles Nor[d]lander ever say to
you, did he in plain English say, yes, sir, I agree,
A&E will share 50 percent of its profits?
A. Absolutely he did. Absolutely.
22
Q. Mr. Davis, let’s look at what you said in your
deposition . . . .
(Thereupon, the video was played as follows:)
Q. Please tell me specifically as possible exactly
what Charles Nor[d]lander said to you that made you
think that you had a promise of a 50/50 partnership on
the revenue streams.
A. He understood, he totally agreed 100 percent that
they weren’t going to have to write me a check. He
wanted to know how much we wanted for a show. We went
through the whole discussion, and I said it’s not for
sale, it’s for partnership.
And I explained that whole concept on the whole
real estate deal. There was no way he could
misunderstand.
***
Q. Please just tell me as specifically as you possibly
can what words Charles Nor[d]lander said that made you
think you had this deal on a 50/50 revenue split.
A. When I laid out my real estate example once again.
I laid it out for him, the basis.
Q. What did he say?
A. I just told you that. I just told you that. I
went through that whole example, and I said, “It’s not
for sale. It’s not for sale. I’ll—I want to be a
hero to the network.”
And Charles said, “Okay, okay, I get it.”
(Thereupon, the video stopped playing.)
BY MR. FEIGELSON:
Q. So, Mr. Davis, you laid out a real estate example?
A. Where I split the revenue as 50/50.
Q. Laid out a real estate example. Sir, just answer
the question. You laid out a real estate example,
correct?
A. Correct.
Q. And you used the word “partner,” correct?
A. Correct.
Q. And you told Charles you wanted to be a hero to the
network, correct?
A. Absolutely.
Q. And he said, “Okay, I get it,” correct?
A. Yes, sir.
Q. And on that basis, you thought you had made a
binding agreement with A&E to divide up 50/50 all the
profits from the television show?
A. It—to this day, absolutely, yes, sir.
23
J.A. at 253—59 (emphasis added).
Plaintiff testified over and over again in unequivocal
terms as to his interpretation or characterization of his June 3
phone conversation with Nordlander. He repeatedly declared they
“absolutely” had a deal. Consequently, we accept, as we must,
that Plaintiff subjectively believed by the end of his June 3
phone conversation with Nordlander he had a deal with Defendant
to make a television show and to split the revenues equally.
But, our review of the record makes clear that Plaintiff was
only able to specify one statement of acceptance by Nordlander:
“Okay, okay, I get it.” We take Plaintiff’s word for it, as we
must, that Nordlander said “Okay, okay, I get it.” 6 We can
safely say that statement does not objectively convey
unambiguous and unequivocal acceptance of Plaintiff’s offer. We
cannot say, however, that such a statement made in a certain
tone of voice or in a given context could not plausibly mean “I
accept.” As we explained, if Plaintiff reasonably or plausibly
6
This is also why the subsequent emails between Plaintiff
and representatives of Defendant in which Plaintiff refers to
his “deal,” “contract,” or “partnership” with Defendant are
irrelevant to the present inquiry. None of those emails
indicate what Nordlander said in the June 3 phone conversation
to accept Plaintiff’s offer. Rather, they reflect what we have
already accepted as true—that Plaintiff believed he had reached
an agreement with Nordlander in that June 3 phone conversation
to make a television series and split the resulting profits
equally.
24
understood Nordlander’s equivocal statement as an acceptance,
then a contract was formed. Therefore, we must decide whether
Plaintiff has presented sufficient evidence from which a jury
could conclude that a reasonable person would have interpreted
Nordlander’s statement as an acceptance.
Plaintiff’s testimony reveals that he and Nordlander
extensively negotiated, discussing production costs, production
crew, production credits, real estate risk, raising revenue, and
splitting revenue, among other things. Nordlander stated his
deal-breaker—bearing any risk for the real estate—and the one
condition on going forward with production of the series—board
approval. And, Plaintiff stated his deal-breaker—splitting all
revenue equally—numerous times in various ways, even
illustrating this term of his offer with a lengthy recounting of
a prior deal. To this, Plaintiff testified Nordlander said
“Okay, okay, I get it.” He also testified Nordlander said their
making the television series was contingent on board approval.
Tellingly, accordingly to Plaintiff, Nordlander did not indicate
their deal was contingent on anything else or give any
indication that Defendant would not accept a fifty-fifty split
of revenue, only that such a split would likely not be a
beneficial arrangement for Plaintiff. Furthermore, no evidence
suggests Nordlander explained that the board would only approve
the series and the money to produce the series without approving
25
the agreement to split net profits equally. And, Defendant
eventually notified Plaintiff that “[t]he board approved the
money for our series.” J.A. at 625. Though the board approved
the making of the show, it seems undisputed that the board
neither considered nor approved any revenue sharing agreement.
Nothing in the record suggests that any of Defendant’s
representatives conveyed to Plaintiff that the board approved
“money for our series,” but did not approve a fifty-fifty
agreement. From this evidence, a reasonable jury could conclude
a reasonable person in Plaintiff’s position after such extensive
bargaining could plausibly interpret “Okay, okay I get it,” in
conjunction with the statement that the only condition is board
approval, as acceptance.
In addition, there is sufficient, though not unequivocal,
evidence from which a reasonable jury could conclude that
Plaintiff objectively treated Nordlander’s statement as an
acceptance of his offer to make a television series and split
the revenues equally. Plaintiff allowed himself and his company
to be the subject of thirteen television shows made by
Defendant. Plaintiff testified that he worked hard to obtain
sponsors and advertisers for the show. J.A. at 181. He also
coordinated with Defendant on using certain products in the
course of business to take advantage of product placement
opportunities, thereby increasing the show’s revenue. Id. at
26
182—86. In an e-mail to one of Defendant’s representatives,
Plaintiff expressed his frustration in not having been presented
with a written agreement that reflected his conversation with
Nordlander: “I was asked up front how much I wanted for the
show and I told Charles then ‘I don’t want to sell, I want to
partner and share the risk and return’ because I knew this would
be a hit . . . . I envisioned a partnership, it feels more like
indentured servant at this point.”
Id. at 706. He said in an
e-mail to a representative of the third party production company
“Charles isn’t [employed by Defendant] anymore but that doesn’t
change the deal he and I cut prior to me even meeting you guys.
. . . If you guys are participating with advertising,
sponsorship, dvd sales, ectm [sic] without us, that was not what
I was promised.”
Id. at 698. In addition, Plaintiff testified
he attempted to get a written confirmation of his agreement with
Nordlander from one of Defendant’s representatives. During one
of those discussions he reiterated that his “deal was 50/50.”
J.A. at 218. The representative’s notes from that discussion
reflect Plaintiff told her of his expectation of a fifty-fifty
split. J.A. at 766.
Naturally, Defendant points to other statements by
Plaintiff that it claims are inconsistent with his claim to have
27
made a revenue-sharing agreement. 7 We acknowledge that is a
plausible, reasonable interpretation of those communications.
But, Plaintiff also proffers another reasonable interpretation.
Plaintiff testified those statements referred to the “production
and talent” aspect of his role in the series, which was separate
from his agreement to share revenues. Plaintiff additionally
argues that the jury could also have believed he and Defendant
were renegotiating their agreement for season two. That would
seem to have been the case, given that the jury awarded
Plaintiff half of only the first season’s profits. And, as
Plaintiff correctly notes, the jury was entitled to reject some
portions of his testimony, while accepting other portions. See
In re Dana Corp., 574 F.3d 129, 152 (2d Cir. 2009) (“But a jury
is free to believe part and disbelieve part of any witness’s
testimony.”). Moreover, we “must disregard all evidence
favorable to the moving party that the jury is not required to
believe.”
Reeves, 530 U.S. at 150. None of the evidence
Defendant has pointed to requires our belief.
B.
Even if Plaintiff and Nordlander agreed orally, Defendant
argues the agreement is unenforceable for indefiniteness because
7
Defendant refers to statements Plaintiff made to
investors, representatives of Defendant, and other television
networks. Aplt. Op. Br. at 24.
28
Plaintiff and Nordlander did not discuss let alone agree on the
following “material” terms: (1) the categories of revenue that
would be included in “net revenue,” (2) the categories of
expenses that would be deducted from “net revenue,” (3) the
duration of the agreement, (4) the grounds for termination, or
(5) the identities of the parties.
“Under New York law, no contract exists, nor may one be
implied, where parties do not agree to its material terms.”
Cleveland Wrecking, 23 F. Supp. 2d at 292 (internal quotations
omitted). Courts do not relish refusing to enforce agreements
for indefiniteness; but:
[I]f the terms of the agreement are so vague and
indefinite that there is no basis or standard for
deciding whether the agreement had been kept or
broken, or to fashion a remedy, and no means by which
such terms may be made certain, then there is no
enforceable contract. Moreover, there [can be] no
contract if the parties [have] fail[ed] to agree on
all essential terms, and if the missing terms cannot
be supplied through reasonable construction that is
consistent with the parties’ intent.
Best Brands Beverage, Inc. v. Falstaff Brewing Corp., 842 F.2d
578, 588 (2d Cir. 1987) (applying New York law) (internal
quotations and citations omitted). Nonetheless, “[s]triking
down a contract as indefinite and in essence meaningless ‘is at
best a last resort.’” 166 Mamaroneck Ave. Corp. v. 151 E. Post
Rd. Corp.,
78 N.Y.2d 88, 91 (1991) (quoting Cohen & Sons v.
29
Lurie Woolen Co., 232 N.Y. 112, 114 (1921)). The Court of
Appeals of New York has warned:
Contracting parties are often imprecise in their use
of language, which is, after all, fluid and often
susceptible to different and equally plausible
interpretations. Imperfect expression does not
necessarily indicate that the parties to an agreement
did not intend to form a binding contract. A strict
application of the definiteness doctrine could
actually defeat the underlying expectations of the
contracting parties. Thus, where it is clear from the
language of an agreement that the parties intended to
be bound and there exists an objective method for
supplying a missing term, the court should endeavor to
hold the parties to their bargain.
Id.
As to the categories of revenue and expenses, the district
court explained the parties’ agreement was simple and clear:
[Plaintiff] didn’t want to sell the show, he wasn’t
going to sell the show, he was responsible for the
real estate, he’d put the people there to produce the
show, he paid his expenses, [Defendant] paid [its]
expenses, they deduct those expenses, and then split
the profits fifty-fifty. If he said that from the
stand, he said it 25 times. As far as expenses are
concerned, I mean, he bought 44 tickets . . . to the
World Series. And [Defendant] rejected those, because
. . . . [t]hey were not related to the project. So I
think it’s easy to assume, and I think the parties
dealt with this assumption, that the expenses were to
be those reasonably incurred in connection with the
production of the show. And that’s how they acted.
So the fact that they didn’t have some formula, that
[Plaintiff] didn’t propose some formula in his
proposal to [Defendant] for arriving at expenses is
unimportant. I think it’s clear that those expenses
can be computed without any difficulty. And it can be
determined which are reasonably related to the
production, and therefore, deducted before the profits
are split.
30
J.A. at 524–25. Plaintiff also testified all revenue generated
by the airing of the show would be included in the contract’s
“revenues.” He explained that their agreement did not
differentiate revenue from advertising during the show by
companies that had previously done business with or already
bought advertising from Defendant from other forms of revenue
generated by the show. J.A. at 266—68. All can reasonably mean
all, without having to list every item included in all. We
therefore conclude sufficient evidence exists from which a
reasonable jury could find that the parties reached an agreement
with sufficiently clear definitions of expenses, revenue, and
“net profits.”
Contrary to Defendant’s assertion, Plaintiff testified that
he and Nordlander discussed the duration and termination of
their enterprise. Plaintiff testified he and Nordlander agreed
in their June 3 phone conversation that the series was subject
to renewal each year based upon the ratings the series received
and could have been canceled at any point by Defendant, though
Plaintiff admittedly hoped the show would continue indefinitely.
Id. at 263—64. Aside from deciding not to renew the series at
the end of each season based on its ratings, Plaintiff concedes
he and Nordlander did not discuss the exact circumstances under
which either party could cancel the agreement.
Id. at 262.
Nonetheless, Plaintiff testified they agreed Defendant could
31
cancel the show at any time. Id. at 264. From this evidence, a
jury could reasonably conclude the parties agreed the series
would continue as long as it was successful, i.e., received
ratings, Plaintiff promised to continue as long as Defendant did
not terminate the show, and Defendant possessed the right to
terminate at will. Plaintiff also contends that if Defendant
could terminate at will, it is objectively reasonable to assume
so could he, of course, subject to the implied covenant of good
faith and fair dealing. Either understanding is reasonable,
sufficiently definite, and consistent with the parties’
ultimately actualized intent to make a reality television series
together. Therefore, Plaintiff presented sufficient evidence
upon which a jury could conclude the parties agreed upon
duration and termination of their agreement.
As to the identity of the parties to the contract,
Defendant does not actually make an argument other than to
declare in a single sentence the contract was fatally indefinite
as to who the parties were. Wahi v. Charleston Area Med. Ctr.,
Inc., 562 F.3d 599, 607 (4th Cir. 2009) (explaining that a
party’s single declarative sentence, without citations to
authorities or the record, is insufficient to raise an argument
on appeal). Regardless, sufficient evidence exists from which a
jury could conclude Defendant knew who Plaintiff was and that
Plaintiff’s real estate flipping business organization was
32
called Trademark Properties. See J.A. at 590 (Nordlander
explaining that Plaintiff made clear to him that Plaintiff
wanted to take his real estate company, Trademark, national).
Defendant provides no argument or authority as to why it is
material to the oral contract whether Nordlander agreed on
behalf of Defendant to do business with Plaintiff or Trademark
or both.
C.
Defendant contends that New York law holds that contracts
that are sufficiently novel and complex must be in writing to be
enforceable and that this agreement is one such contract. In
addition, Defendant maintains that Plaintiff’s repeatedly-
asserted expectation that their agreement be reduced to writing
proves that the parties only intended to be bound by a writing.
Defendant’s statement of New York law is not entirely
correct. We can find no case, nor has Defendant cited one, in
which a New York court declared that as a matter of law a
contract was so novel and complex that it had to have been in
writing to be enforced. Instead, under New York law whether an
oral agreement in the absence of a writing is binding depends on
the parties’ objectively-manifested intent. Winston v.
Mediafare Entm’t Corp., 777 F.2d 78, 80 (2d Cir. 1986). And,
the sole case Defendant cites on this point makes clear that to
discern that intent, we consider a number of factors, including:
33
(1) whether a party has made an “explicit statement
that it reserves the right to be bound only when a
written agreement is signed,” (2) “whether one party
has partially performed,” (3) “whether there was
literally nothing left to negotiate or settle, so that
all that remained to be done was to sign what had
already been fully agreed to,” and (4) “whether the
agreement concerns those complex and substantial
business matters where requirements that contracts be
in writing are the norm rather than the exception.”
Braun v. CMGI, Inc., 64 F. App’x 301, 303 (2d Cir. 2003)
(quoting R.G. Group, 751 F.2d at 75—76 (applying New York law))
(emphasis added). “No single factor is decisive, but each
provides significant guidance.” R.G.
Group, 751 F.2d at 75.
Therefore, contrary to Defendant’s assertion, “whether the
agreement concerns those complex and substantial business
matters where requirements that contracts be in writing are the
norm” is just one factor the fact-finder considers in deciding
whether the parties intended to be bound without a written
document.
Id. at 76; see also Consarc Corp. v. Marine Midland
Bank, N.A.,
996 F.2d 568, 576 (2d Cir. 1993) (explaining that
these factors guide the fact-finder’s determination of the
parties’ intention to be bound without a writing).
First, Defendant contends because the alleged contract in
this case “involved potentially millions of dollars, was a sharp
departure from [its own] and industry practice . . . and by
[Plaintiff’s] own account could run for decades . . . . [a]
writing therefore was legally necessary to bind the parties.”
34
Aplt. Op. Br. at 42. We agree that the contract involved a
“substantial business matter” and it may well not have been
Defendant’s typical practice to split revenues. But we also
note a reasonable jury could find that the contract at issue was
not so complex. Hiring a third-party production company, adding
all revenue, subtracting all reasonable expenses, splitting the
remainder in two, and renewing each year depending on the show’s
ratings are easy enough concepts to understand. The jury could
have also considered Defendant’s demonstrated willingness to
produce, pay for, and air a television series—a substantial
business matter even without any agreement to share revenue—
without a written contract.
Second, Defendant argues “[t]he evidence that the parties
intended and attempted to reach a written agreement strongly
confirms that the purported oral agreement was unenforceable”
without a writing. Aplt. Op. Br. at 43. Again, Defendant
cannot escape the fact that by its own admission it undertook to
develop and air a television series featuring Plaintiff without
a written contract. It is not such a far leap from that fact to
infer that Defendant and Plaintiff also intended to be bound by
their oral agreement as to how to compensate Plaintiff without a
written contract. There is also no evidence that Nordlander or
any other of Defendant’s representatives ever stated Defendant
would not be obligated to Plaintiff without a formally executed
35
document. Furthermore, we agree with the district court that
the jury could have reasonably concluded from the trial
testimony that Plaintiff “thought he had an oral contract, but
expected a written contract. . . . [M]ost people feel more
comfortable with a written contract than with an oral contract.
And I think that based upon his testimony, which the jury could
have believed, he was promised a written contract by Mr.
Nordlander, and he thought he was going to get one.” J.A. at
525. That a party wants an oral contract reduced to writing
does not necessarily mean the parties did not intend to be bound
until such reduction; it may just reveal that the party wants to
avoid a “he said, she said” argument down the road as to what
the parties orally agreed. See Winston, 777 F.2d at 80 (“This
freedom to contract orally remains even if the parties
contemplate a writing to evidence their agreement. In such a
case, the mere intention to commit the agreement to writing will
not prevent contract formation prior to execution.”).
D.
Defendant claims that two releases Plaintiff signed entitle
it to judgment as a matter of law because the language of these
releases protects it from Plaintiff’s breach of contract claim.
“The meaning and scope of a release must be determined within
the context of the controversy being settled, and a general
release cannot be construed to cover matters which the parties
36
did not desire or intend to dispose of.” In re Brown, 885
N.Y.S.2d 222, 223 (N.Y. App. Div. 2009) (internal quotations and
citations omitted).
Plaintiff signed two releases after the June 3 phone
conversation, but before he filed suit. The “Standard Location
Release” grants Departure (the production company that filmed
and edited the episodes) and its assigns the right to “record as
desired the premises located at Trademark Properties” and to
“exhibit, display and transmit . . . all or any portion of the
Footage” and indemnifies Departure and its assigns “from and
against all claims, losses, costs, expenses, settlements,
demands, and liabilities of every kind . . . arising out of or
incurred by reason of use of the Footage in accordance herewith
or the inaccuracy, alleged breach or actual breach of any
representation, warranty, covenant, agreement . . . made
herein.” J.A. at 690. The “Standard Personal Release” grants
Departure and its assigns “the irrevocable right and license to
use [Plaintiff’s] name and biographical material concerning
[Plaintiff], and the right to exhibit, distribute, transmit,
display . . . edit, alter and modify any video tape . . . made
by . . . Departure Films . . . of [Plaintiff’s] likeness . . .
made by [Departure] . . . without additional compensation to
[Plaintiff]” and releases Departure and its assigns from “all
claims . . . arising out of the production, exhibition,
37
distribution, promotion and/or advertising of ‘untitled project’
. . . including without limitation, any claim for defamation,
slander or invasion of privacy.” J.A. at 691. It is undisputed
that Departure subsequently assigned all of its rights to
Defendant. These documents only release Defendant from any
claims Plaintiff might have arising from the display of the
footage of Trademark’s premises (the Location Release) and the
“production, exhibition, distribution, promotion and/or
advertising” of the show (the Personal Release). Thus, the
releases do not immunize Defendant from liability for breach of
the parties’ contract to share revenues.
IV.
Now, we turn to Defendant’s contention that the district
court’s incorrect jury instructions and evidentiary rulings
entitle it to a new trial pursuant to Fed. R. Civ. P. 59. We
review the district court’s denial of a motion for a new trial
and its rulings on the admissibility of evidence for abuse of
discretion. See Figg v. Schroeder, 312 F.3d 625, 641 (4th Cir.
2002) (“We review for abuse of discretion a district court’s
denial of a motion for new trial . . . under Fed. R. Civ. P.
59.”); Schultz v. Capital Intern. Sec., Inc.,
466 F.3d 298, 310
(4th Cir. 2006) (“We review a district court’s evidentiary
rulings for abuse of discretion.”). “A trial court’s exercise
38
of such discretion is entitled to substantial deference, and
will be upheld so long as it is not arbitrary or irrational.”
United States v. Myers, 589 F.3d 117, 123 (4th Cir. 2009)
(internal quotations and citations omitted). But, “[u]nless
justice requires otherwise, no error in admitting or excluding
evidence . . . is ground for granting a new trial . . . . At
every stage of the proceeding, the court must disregard all
errors and defects that do not affect any party’s substantial
rights.” Fed. R. Civ. P. 61. We only grant a new trial when we
can say “‘with fair assurance, after pondering all that happened
without stripping the erroneous action from the whole, that the
judgment was . . . substantially swayed by the error,
[therefore] it is impossible to conclude that substantial rights
were not affected.’” Bank of Montreal v. Signet Bank,
193 F.3d
818, 834 (4th Cir. 1999) (quoting Kotteakos v. United States,
328 U.S. 750, 765 (1946)).
A.
Defendant claims the district court should have admitted
Paragraph 11 of Plaintiff’s complaint, pursuant to Fed. R. Evid.
801(d)(1)(A) and 801(d)(2)(A). According to Defendant,
Paragraph 11 states Plaintiff made the alleged oral agreement in
an in-person meeting with Nordlander and another representative
of Defendant, witnessed by a representative of Departure Films.
Defendant maintains Paragraph 11 is inconsistent with
39
Plaintiff’s testimony that the contract was formed during his
June 3 phone conversation with Nordlander and therefore “key
evidence that discredited” Plaintiff’s account. Aplt. Op. Br.
at 51. Plaintiff objected to its admission. The district court
ruled it inadmissible because it was not clearly adopted by
Plaintiff and not clearly inconsistent with his trial testimony.
J.A. 307—08.
Even if the district court erred in deciding the complaint
did not satisfy the requisites for admissibility, we conclude
the error was harmless. Defendant impeached Plaintiff on the
same point through the introduction of Plaintiff’s answer to
Interrogatory Number 9 and his deposition testimony. Defendant
asked Plaintiff at trial about his answer to Interrogatory 9 in
which he stated:
The agreement was reached and discussed between
Charles Nor[d]lander with [Defendant] and [Plaintiff].
A conference call was then held between Charles
Nor[d]lander, Thomas Moody, Nancy Dubuc, and Richard
C. Davis at which time it was agreed that the
Plaintiffs and the Defendant . . . would be equal
50/50 partners of [Plaintiff’s] concept and treatment
. . . and would share equally in all net revenues and
proceeds generated from the exploitation of the
series.
Id. at 811; see also
id. at 269—70 (defense counsel cross-
examines Plaintiff about his interrogatory answer). Defendant
also played at trial a part of Plaintiff’s videotaped deposition
testimony during which Plaintiff stated about the conference
40
call, “‘I remember that being the defining moment of when I
struck this deal with [Defendant].’” J.A. at 276. This
evidence contradicts Plaintiff’s trial testimony that the
revenue-sharing contract was formed during the June 3 telephone
conversation with Nordlander. Therefore, the admission of
Plaintiff’s complaint would have only reiterated Plaintiff’s
conflicting account.
B.
In support of its defense that Nordlander and Plaintiff
never made a revenue-sharing contract, Defendant sought to
introduce testimony from Nordlander and two of its other
employees to the effect that reality television stars never
receive revenue-sharing contracts. Defendant argues that their
testimony is not “expert” testimony but “factual context.” As
such, Defendant claims the witnesses should have been able to
“‘offer an opinion on the basis of relevant historical or
narrative facts [they have] perceived’” without being deemed
“experts.” Aplt. Op. Br. at 57 (quoting MCI Telecomm. Corp. v.
Wanzer, 897 F.2d 703, 706 (4th Cir. 1990) (internal quotations
and citations omitted)). Plaintiff objected to this testimony
and the district court sustained this objection on the basis
that these individuals had not been designated as experts
pretrial and so could not testify as to industry practice. In
summary, the district court ruled as to all three of the
41
controverted witnesses’ opinions: “[T]his witness was not
disclosed as an expert. He has been asked to express an opinion
as to a certain practice prevailing or not prevailing in the
industry in which he works, and he cannot do that.” J.A. at
363.
A witness testifying not as an expert must limit his
opinion testimony: “to those opinions or inferences which are
(a) rationally based on the perception of the witness, (b)
helpful to a clear understanding of the witness’ testimony or
the determination of a fact in issue, and (c) not based on
scientific, technical, or other specialized knowledge within the
scope of Rule 702.” Fed. R. Evid. 701. Defendant did not seek
to admit solely the witnesses’ lay opinion testimony based on
“records kept by [them] personally under [their] control,” and
“predicated on [their] personal knowledge and perception.”
Wanzer, 897 F.2d at 706. Rather, Defendant sought to admit the
witnesses’ specialized knowledge as to the entire television
industry. Defendant was certainly entitled to present testimony
regarding its own standard practices and each witness was
allowed to testify that based upon their experience and
knowledge of historical facts no one had ever made a fifty-fifty
revenue sharing deal with Defendant. Therefore, the district
court did not abuse its discretion in deciding that to present
any specialized knowledge of the television industry, the
42
Defendant should have disclosed and qualified these witnesses as
experts.
C.
Defendant next argues the district court improperly allowed
Plaintiff to testify that he “owned” the television series and
that Defendant stole it from him despite Defendant’s objections
and incorrectly refused to issue a curative instruction on the
subject to the jury. 8 The district court overruled Defendant’s
objection to that testimony because “the word ‘own’ has a common
meaning, and . . . when [Plaintiff] makes that expression,
that’s expressing his intent, and his understanding of the
status of the pilot [episode]. . . . [H]e has a perfect right to
testify to that.” J.A. at 170–71. And, the court told the
jury:
What counsel is saying is that when he says he owns
it, that’s a legal conclusion, and he may own it and
he may not own it legally. And the reason I let him
testify to it is because that’s what he says because
he thinks he owns it, and he expressed that thought in
his conversation. I’m not sure what will develop in
this case at any later period of time. It may be that
the question of ownership is a serious issue that you
have to decide. And if it does become an issue that
8
The substance of Defendant’s arguments as to the court’s
failure to sustain its objection and issue its requested jury
instruction on Plaintiff’s statements as to ownership and theft
of the show are the same. We review both claims of error for
abuse of discretion. S. Atl. Ltd. P’ship v. Riese, 284 F.3d
518, 530 (4th Cir. 2002). Therefore, we treat both issues
simultaneously in this section.
43
you have to decide, then I may be required to charge
you the law as to ownership, and what it takes for
someone to own a property such as this. And if that
is the case, then you can decide that issue of
ownership if it becomes necessary. And the fact that
this witness has said he owned it, and I let him
testify to it, may or may not be critical as to that
issue, if we do get to that issue and if you are
called upon to decide it. So it’s a legal conclusion
that you may have to decide, and if you do, I’ll give
you the law upon which you can decide it, you finding
the facts. But if it’s not a legal conclusion, and
that has to be decided, and he can express his opinion
about it, then his testimony can come in. Okay? I
don’t mean to confuse you, but I can’t predict exactly
what’s going to happen in the case. And if ownership
does become a legal issue, then I will submit that
issue to you to decide, based upon applicable law.
Okay?
Id. at 171–72. Defendant requested a jury instruction that
Plaintiff’s statements as to ownership and theft are irrelevant
to Plaintiff’s contract claim. The district judge rejected the
charge, explaining:
[M]y charge says nothing about ownership. It says to
prove a breach of contract, you’ve got to prove this,
this, and this. . . . [Plaintiff] inserted those words
[of ownership and theft], but ownership is not
necessary . . . I’m going to tell them what he has to
prove, and he doesn’t have to prove ownership.
Id. at 438–39.
The district court did not abuse its discretion in either
failing to sustain Defendant’s objection or refusing to give the
requested curative instruction. The court informed the jury
that it would let the jury know if ownership was an issue it
needed to decide and that if it was not, then Plaintiff’s
44
statements on the subject were essentially irrelevant. When the
court did not instruct the jury on ownership it was left to
decide the only issue it was given instructions to decide—the
contract claim. Moreover, we can infer from the jury’s award of
half of only the first season’s profits, rather than an
“owner’s” half of all seasons’ profits, that it was not
influenced by Plaintiff’s allegations of ownership.
D.
Defendant next complains the district court erroneously
failed to instruct the jury on the requirement of “specific
words of assent.” Id. at 439—40. “We review challenges to jury
instructions for an abuse of discretion.” S.
Atl., 284 F.3d at
530. “Instructions are adequate if ‘construed as a whole, and
in light of the whole record, [they] adequately [inform] the
jury of the controlling legal principles without misleading or
confusing the jury to the prejudice of the objecting party.’”
Id. (quoting Spell v. McDaniel,
824 F.2d 1380, 1395 (4th Cir.
1987)). Even if we detect error, we do not reverse “unless the
error seriously prejudiced the challenging party’s case.”
Id.
Defendant submitted thirty-six proposed jury instructions.
Then at trial, Defendant’s counsel orally requested another jury
instruction to the effect that under New York law formation of
an oral contract requires “specific words of assent” based upon
two cases, Gomez v. Bicknell,
756 N.Y.S.2d 209 (N.Y. App. Div.
45
2002), and Agric. Ins. Co. v. Matthews, 749 N.Y.S.2d 533 (N.Y.
App. Div. 2002). Defendant did not submit to the district court
a copy of the specific instruction it requested on this issue.
See J.A. at 439–40 (“Your Honor, the last thing we would request
is a charge that we don’t have a specific charge for, but is
incorporated in the Gomez case, and the Agricultural Insurance
Company that I passed up, which is an oral contract in New York,
there was a requirement for specific words of assent.”). Nor
does it provide the text of this hypothetical instruction on
appeal. The joint appendix on appeal only provides two pages of
the transcript of the discussion of this proposed instruction
which does not reveal how the court ultimately ruled on the
instruction (though we can tell by the instructions it did give,
it refused to give this requested instruction) and, more
importantly, why it so ruled. Nonetheless, Defendant argues on
appeal its requested instruction was necessary because without
it the jurors were free to conclude, allegedly contrary to New
York law, “that they could recognize a contract by cherry-
picking Plaintiff’s conclusory statements about the existence of
an agreement while disregarding all of Plaintiff’s contradictory
admissions and writings.” Aplt. Op. Br. at 49.
The district court instructed the jury there are three
essential elements to the formation of a binding contract:
46
First, that there is a contractual intent on the part
of all parties to the contract . . . both of those
people have got to have an intent, a desire to enter
into a contract. You don’t enter into a contract by
accident. . . . And the second essential element is
. . . an actual meeting of the minds of the
parties. . . . In other words, they agree on all of
the elements of the contract. You can’t have a
contract if you don’t agree on everything. . . . Now,
there are some contracts in our law that must be in
writing. . . . But this is not such a contract . . .
and this one can be agreed upon, can be made, can be
made to the point of being enforced if it is oral, or
partially oral and partially written. But there has
to be an offer and an acceptance for there to be a
contract.
J.A. at 460–61. As our extensive discussion of the requirements
for contract formation under New York law make clear, the
district court’s instructions on acceptance and mutual assent to
material terms are adequate and do not misstate New York law.
E.
Lastly, Defendant challenges the district court’s response
to a jury question. During its deliberations, the jury asked:
“Do we need to determine that there is a revenue sharing
contract between the two parties? Do we need to determine that
there is a 50/50 revenue split contract between the two
parties?” The district court responded by explaining that it:
[D]idn’t suggest any particular type [of] contract to
you. And [it] didn’t do that because that’s really
not part of the law; that’s a part of the facts. But
I did say to you that when you considered this first
element, the existence of a contract, and if you find
that [P]laintiff has proven the existence of a
contract . . . then you will know what that contract
provides. . . . [I]f he has proven it, you know what
47
it is; you know whether it’s a 50/50 split; you know
whatever the evidence supports. And I can’t tell you
you have to find a particular kind of contract because
that’s just not my job.
Id. at 470–71.
“We review a district court’s decision to respond to a
jury’s question, and the form of that response, for an abuse of
discretion.” United States v. Foster, 507 F.3d 233, 244 (4th
Cir. 2007). “‘[I]n responding to a jury’s request for
clarification on a charge, the district court’s duty is simply
to respond to the jury’s apparent source of confusion fairly and
accurately without creating prejudice.’”
Id. (quoting United
States v. Smith,
62 F.3d 641, 646 (4th Cir. 1995)). “An error
requires reversal only if it is prejudicial in the context of
the record as a whole.”
Id.
Defendant argues the district court abused its discretion
by not directly answering the questions asked and failing to say
that the 50/50 profit share as contended by Plaintiff was the
only agreement the jury could possibly recognize. By failing to
answer the questions, Defendant claims the district court
essentially invited the jury to craft its own version of a
contract—which is what it claims the jury did by awarding only
half of the revenue from the first season to Plaintiff, rather
than awarding half of the revenue of all three seasons to which
Plaintiff asserted he was entitled.
48
First, the district court’s answer did not misstate the law
or the facts. Second, its answer did not invite the jury to
“craft” its own contract, but it did properly remind the jury
that only the jury could “find” or “determine” whether a
contract existed and, upon the basis of that conclusion, decide
what the terms of the contract were. And, lastly, the jury was
free to believe parts and disregard parts of Plaintiff’s
testimony and evidence. Based on the jury’s verdict, it likely
concluded based upon Plaintiff’s testimony and other evidence
that the parties had agreed to split equally the show’s
revenues, but disregarded other parts of Plaintiff’s testimony
and evidence in deciding that Plaintiff was not entitled to half
of the revenue from the second and third seasons because the
parties had only reached an agreement as to the first season.
V.
For the reasons herein, we affirm the district court’s
denial of Defendant’s motions for a judgment as a matter of law
and a new trial.
AFFIRMED
49
DUNCAN, Circuit Judge, dissenting from the judgment:
I am in full agreement with the majority’s conclusion that
Mr. Davis deserves to be compensated for the services he
indisputably provided A&E Television Networks. Davis’s position
is made all the more sympathetic by the fact that A&E bears
significant responsibility for the failure to reduce a contract
memorializing its understanding to writing.
Moreover, it certainly appears that Davis had viable
claims. He could have brought an action in quantum meruit. As
the majority recognizes, Davis also asserted acceptance by
conduct, on which the district court, inexplicably, declined to
instruct. Unfortunately, however, the jury was not asked to
find facts undergirding either such theory.
We are thus left with the contention that Nordlander’s
statement, “Okay, okay, I get it,” J.A. at 258, constitutes
“clear, unambiguous and unequivocal” acceptance, IBM Corp. v.
Johnson, 629 F. Supp. 2d 321, 330 (S.D.N.Y. 2009), which is
simply not the law. The majority’s reliance on Johnson for its
conclusion that “if [Davis] reasonably or plausibly understood
Nordlander’s equivocal statement as acceptance, then a contract
was formed,” (Maj. Op. at 24) runs contrary to the basic legal
principles underlying contract formation. Contracts require
mutual assent, and a unilateral understanding, by definition,
cannot meet that requirement.
50
Because I do not believe a reasonable person would
interpret “Okay, okay, I get it,” alone as acceptance, or indeed
as anything other than “I understand what you are saying,” I
must respectfully dissent.
51
