Entertainment Law Question #15?

Here is a hypothetical situation in which there may be more than one correct answer. What do you think? (Again, this is not my homework. I have my own views and just want to see how they correspond with others who know more about law than me. See my other questions if you're interested. I've posted my own answers too.)


Sally Sexpot is a popular "porn movie" actress. The Academy of Interactive Entertainment (AIE) will be conducting its first annual awards presentation three months from now. Similar to the Academy Awards, the AIE wants to use celebrity presenters, just like the Motion Picture Academy does. Thus, earlier this month, the Academy orally invited Sally to make a presentation, and offered to pay her an honorarium of $250. She accepted the offer orally, but nothing was ever put into writing. Now a complication has arisen. Sally has been offered a role in a major feature film which requires her to be on location in Hawaii for her nude scenes on the day the awards show takes...

...place. As a result she has told the AIE that she will not be able to make the presentation. The people at the academy are taking a hard line with her, and have threatened to sue her for breach of contract if she fails to show up. Sally is surprised to hear the term "contract" as she has never signed anything. The Academy is a California corporation; Sally Sexpot is a California resident; the oral offer was made and accepted in California; and the awards program will take place in California.

If the AIE sues sexpot for breach of contract seeking money damages, what is the likely outcome? What is the likely outcome if the Academy seeks an injunction, instead of money damages?

First, you need to determine if there was a contract. Here, AIE made an offer, seeking SS performance and SS accepted the offer to perform. No counteroffers were made and no conditions destroyed the offer or acceptance. Thus a contract exists.

AIE can potentially get money damages if they (as the other answer noted) relied on her acceptance of the contract. While SS may try to defend on the basis that there was no contract because there was no writing (statute of frauds defense), this will not work because it is a service contract and SOF would not protect SS. I say AIE may only potentially be awarded damages because it depends on what AIE did in reliance on the acceptance. If AIE's detrimental reliance on the contract with SS were negligible the court would probably not award damages.

Also, as an aside, this claim would be a "promissory estoppel" claim (a.k.a. detrimental reliance).

AIE cannot get an injunction. Regarding injunctions to force performance, I mentioned this in one of your previous questions, don't remember the exact question, bug again generally courts do not like to force the performance of a contract. Especially a service contract. For instance, imagine if a famous painter contracted with super socialite to have a portrait painted and then FP decides to back out. It makes things very complicated if a court forced performance.

How does a court determine what is satisfactory performance? What happens if the party seeking enforcement isn't satisfied with the service? Who is going to pay for the missed opportunities by the party who originally breached the contract? (e.g. if SS were forced to perform at the AIE award, she will lose on her role in the Hawaii film so who is going to be responsible for that?)

If she didn't sign anything, and didn't accept any money yet, she's fine ditching the awards ceremony for the movie.

Well if there is no legal document or any documentation, Sally can do as she pleases, a he said she said in court does not hold up very well. So unless there was any documentation, Sally can do as she pleases and does not have any ties with the AIE.

My interpretation: If AIE relied on Sally Sexpot's word that she will be a presenter while making plans, and those plans have to change and they could have some sort of damages, then YES, Sally is under a contract. For instance, they secured sponsors who only agreed to be sponsors because they knew Sally would be a presenter, and you will lose this money because Sally pulled out. Contract. If AIE can get someone else, though, and incur no damages, then it's really not a contract. Make sense?

Similarly, if you call and pledge $10 to the March of Dimes, then reneg, they can't really do anything about it because it's not really any kind of contract. But if you pledge $10 million, and they break ground on a new hospital because of your promise, then they CAN go after you because it IS a contract. But they had to have done something that RELIED on your word.

This is my very loose interpretation.