1- Read Case 10.1 in Chapter 10 of your textbook. Is the general release signed by Marder an enforceable contract? Identify each element of a contract and the facts that would support each element.
CASE 10.1 FEDERAL COURT CASE Contract Marder v. Lopez
450 F.3d 445, Web 2006 U.S. App. Lexis 14330 (2006)
United States Court of Appeals for the Ninth Circuit
“. . . . In hindsight the agreement appears to be unfair to Marder—she only received $2,300 in exchange for a release of all claims relating to a movie that grossed over $150 million . . . .”
—Pregerson, Circuit Judge
The movie Flashdance tells a story of a woman construction worker who performs at night as an exotic dancer. Her goal is to obtain formal dance training at a university. The movie is based on the life of Maureen Marder, a nightclub dancer. Paramount Pictures Corporation used information from Marder to create the screenplay for the movie. Paramount paid Marder $2,300, and Marder signed a general release contract that provided that Marder “releases and discharges Paramount Picture Corporation of and from each and every claim, demand, debt, liability, cost and expense of any kind or character which have risen or are based in whole or in part on any matters occurring at any time prior to the date of this Release.”
Paramount released the movie Flashdance, which grossed more than $150 million in box office receipts and is still shown on television and distributed through DVD rentals. Marder brought a lawsuit in U.S. district court against Paramount, seeking a declaration that she had rights as a co-author of Flashdance and a co-owner with Paramount of the copyright to Flashdance. The district court dismissed Marder’s claims against Paramount. Marder appealed.
Is the general release Marder signed an enforceable contract?
Language of the Court
The Release’s language is exceptionally broad and we hold that it is fatal to each of Marder’s claims against Paramount. Accordingly, the law imputes to Marder an intention corresponding to the reasonable meaning of her words and acts. Though in hindsight the agreement appears to be unfair to Marder—she only received $2,300 in exchange for a release of all claims relating to a movie that grossed over $150 million—there is simply no evidence that her consent was obtained by fraud, deception, misrepresentation, duress, or undue influence.
The U.S. court of appeals held that the general release Marder signed was an enforceable contract. The court of appeals affirmed the judgment of the district court that dismissed Marder’s complaint against Paramount.
Did Marder act unethically in bringing this lawsuit? Did Paramount owe an ethical duty to pay Marder more money after the movie Flashdance became a success?
1- Why is the objective theory of contracts applied in determining whether a contract has been created? Why is the subjective intent of the parties not considered?
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