4th Circuit: Trademark Victory Affirmed

After considerable delay, an opinion has been issued by the Fourth Circuit Court of Appeals in the Trademark v. A&E Case:

Plaintiff Richard C. Davis approached Defendant A&E Television Networks with the concept that he maintains became the reality television series “Flip This House.” 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. … 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 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. … 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.

There are some interesting excerpts from the transcript in the opinion, including details of the negotiation that resulted in the 50/50 deal (after expenses, which would be fronted by Trademark) between Trademark and A&E. It’s also fun reading about verbal contracts.

The dissent identifies one of the most critical issues that resulted in a Trademark win, “A&E bears significant responsibility for the failure to reduce a contract memorializing its understanding to writing.” If there is anything to be learned from this event, it’s that reducing an agreement to writing is a very good thing.

The agreement still balances on the shaky assertion that “Okay, okay, I get it,” during a phone call indicated A&E’s agreement to the 50/50% split, but the overwhelming weight of the other evidence and the fact that the parties seemed to act as if they had an agreement seems to have pushed the decision in favor of Trademark.

Hopefully this is the end of the case. A&E should take their licking and move on. I have a feeling that Richard Davis will put the money to good use, but that he probably would have preferred to keep making television.

I personally would like to see some follow up on the people involved in Flip This House – including the new casts. An interesting show could be made explaining how the various casts have handled the bubble crashing. A special episode could focus on people taken in by some of the hucksters like Armando Montelongo. The stories I’ve received and things posted in the comments over the past few years make it clear that there are many hardworking people out there who are easily led down unwise financial paths. I’m sure there are some successes, but the disasters make for interesting lessons too.

[Hat Tip to theĀ Entertainment Law Update Podcast]